Making Tax Digital: Key Filing Requirements Landlords Should Prepare For

Making Tax Digital (MTD) is set to change how landlords report their income to HMRC, and many are being encouraged to start preparing early to avoid confusion and delays.

This is because, as MTD is phased in, landlords meeting the income criteria will find themselves submitting significantly more updates to HMRC than they are used to. While this may sound daunting at first, understanding how the system works and what is required can make the process more manageable.

Which Landlords Will Need to Submit More Updates

Under Making Tax Digital, landlords who earn more than £50,000 a year will be required to keep digital records and send quarterly updates to HMRC from April 2026, using approved MTD-compatible software.

Those earning between £30,000 and £50,000 will join the system a year later, in April 2027. During the transition period, landlords may still need to complete Self Assessment Tax Returns alongside their new quarterly updates, which explains why the number of submissions could temporarily increase.

Understanding Quarterly Reporting Under Making Tax Digital

The first quarterly update under Making Tax Digital will be due by 7 August and will cover income and expenses recorded between 6 April and 5 July. Further updates must then be submitted every three months, with the next deadline falling on 7 November.

It is important to note that these quarterly updates are not full tax returns. They are summaries of income and expenses, designed to keep records up to date throughout the year rather than waiting until the annual deadline.

How Self Assessment Fits In During The Transition

Despite the move to quarterly reporting, landlords will still need to submit annual tax returns under the existing system during the transition period.

The Self Assessment Tax Return for the 2024/25 tax year must be filed by 31 January this year, while the return for the 2025/26 tax year will be due by 31 January 2027. This overlap means landlords will need to be particularly organised to ensure nothing is missed or duplicated.

Why Early Preparation Matters in MTD for Landlords

Industry representatives have warned that the transition to MTD for landlords could confuse many.

With multiple submissions replacing a single annual return, keeping clear and accurate records will be essential. Preparing early and understanding how quarterly updates work can help landlords avoid mistakes and unnecessary stress.

What HMRC Says About Making Tax Digital

HMRC has stated that the aim of Making Tax Digital is to simplify tax reporting over time. Quarterly updates will consist of straightforward summaries sent using compatible software, with much of the information carried over into the annual tax return automatically.

According to HMRC, this approach should help landlords gain a clearer picture of their income, expenses and overall tax position throughout the year, rather than dealing with everything at once at the end of the tax year.

Costs To Be Aware Of

The government has previously acknowledged that there may be some additional costs linked to the transition. Estimates suggest landlords earning £50,000 could face an average one-off transitional cost of £285, along with an ongoing annual cost of around £115.

While these costs exist, understanding the requirements early and choosing the right software can help landlords manage the move to digital reporting more smoothly.

Conclusion

Making Tax Digital represents a shift in how landlords report their income, with a stronger focus on regular record-keeping rather than a single annual submission. While the transition period means some landlords may need to submit more updates than usual, the underlying requirements are clearly defined once the reporting timetable is understood.

By familiarising themselves with quarterly update deadlines, the continued role of Self Assessment during the transition, and HMRC’s expectations around digital records, landlords can approach MTD with greater confidence. Early preparation and a clear understanding of the process can help ensure compliance while keeping tax reporting straightforward and organised.