250,000 Sign Up for MTD. But Most Landlords Still Aren’t Ready

It’s been a little over a week since Making Tax Digital (MTD) for Income Tax became mandatory, and in that time, HMRC has recorded more than 250,000 sign-ups.

At first glance, this suggests rapid public adoption of the new tax regime. But peek behind the curtain and you’ll find a reality that’s exactly the opposite.

Around 69% of the 250,000 registrations have been completed by accountants and tax agents, not individual taxpayers. This means that direct engagement from landlords and self-employed individuals remains significantly lower than expected. This is concerning given that roughly 864,000 taxpayers fall within the scope of the first phase of MTD.

Why Are Landlords Not Signing Up for MTD?

Many landlords are not signing up for MTD primarily because they are not fully aware of what the system requires. This lack of engagement is reflected in HMRC’s estimate that around 600,000 individuals still need to register ahead of the first quarterly deadline in August, showing how many affected taxpayers remain outside the system entirely.

What’s worth understanding, though, is that this delay isn’t being driven by resistance. It’s happening because many landlords have not yet had to deal with the system directly, and so the urgency hasn’t fully landed. Some are relying on accountants to handle the transition, while others are assuming it can be dealt with closer to the deadline.

What Does MTD Change for Landlords?

MTD for Income Tax changes how landlords and self-employed individuals report their income. Instead of submitting everything at the end of the year, those with gross qualifying income (£50,000 for this year) must now keep digital records and send updates to HMRC every quarter.

That shift changes the rhythm of accounting. It’s no longer a once-a-year process where figures are pulled together at the end. The information has to stay accurate and up to date throughout the year so it can be reported regularly without delay.

For landlords, this effectively turns accounting into a continuous process rather than a single annual event.

If Not Taxpayers, Then Who Are the 250,000 Who’ve Signed Up for MTD?

The majority of the 250,000 sign-ups are not individual taxpayers acting on their own. They are being completed by accountants, tax agents, and software providers working as part of early onboarding into the system.

HMRC’s figures confirm that agents account for most of the 250,000 registrations. This means that early rollout has been driven less by taxpayers engaging directly, and more by the infrastructure around them preparing in advance.

While this has helped the system move forward smoothly at launch, it also highlights a growing dependency on intermediaries. As the first quarterly deadline approaches in August, the real question shifts away from software readiness and towards user readiness — whether landlords and self-employed individuals can maintain ongoing compliance without constant support. That gap between operational systems and taxpayer behaviour is where the pressure is likely to emerge.

Why Landlords Should Sign Up for MTD Now?

Landlords should sign up for Making Tax Digital immediately because the system is already live and the process of onboarding is becoming more time-sensitive as the first quarterly deadlines approach. The longer landlords wait, the more likely they are to face pressure when reporting obligations begin to stack up.

MTD relies on ongoing digital records rather than year-end catch-up accounting. That means getting set up early is not just about compliance; it is about avoiding disruption later when quarterly submissions become routine.

For landlords, signing up now is less about urgency in isolation and more about reducing friction before the reporting cycle fully takes hold.

Conclusion

MTD for Income Tax is now operational, but the rollout is still uneven. Accountants are leading adoption, software providers are supporting infrastructure, and HMRC is pushing scale.

But many landlords remain removed from the system that will soon govern how they report income.