HMRC writes to landlords as Making Tax Digital deadline approaches
9:32 AM, 5th February 2026, 3 months ago
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HMRC will write to thousands of landlords in the coming weeks ahead of the rollout of Making Tax Digital (MTD).
Under the controversial scheme, from April this year, landlords earning more than £50,000 will be required to keep digital records and submit quarterly updates to HMRC using authorised MTD-compliant software.
HMRC will contact landlords with income above the £50,000 threshold to explain how to prepare, including details of the new reporting system.
Make it easier for landlords
HMRC continue to claim MTD will be beneficial for landlords.
Craig Ogilvie, HMRC’s director of Making Tax Digital, said: “MTD for Income Tax is the most significant change to the Self Assessment regime since its introduction in 1997.
“It will make it easier for self-employed people and landlords to stay on top of their tax affairs and help ensure they pay the right amount of tax.”
The first batch of letters will be sent between 2–13 February and 16–27 March, confirming that affected taxpayers will be required to comply with Making Tax Digital from the start of the 2026–27 tax year.
The letters outline the main changes under MTD for Income Tax, including what MTD is, when taxpayers must begin using it, and the new requirement to submit quarterly updates using digital software.
No real benefit
As previously reported on Property118, many industry experts have raised scepticism over MTD.
Accountant Simon Misiewicz told Property118: “There’s no real benefit beyond maybe streamlining some of the work you already do. Does it help with tax returns and submissions? The truth is, I can’t see how.
“There’s no advantage for the individual in submitting quarterly returns, because HMRC doesn’t do anything with them until the end of the year. You don’t pay your taxes any earlier, and there is no real cash-flow benefit for the government”.
The government admitted in the MTD impact assessment that landlords earning £50,000 could incur an average transitional cost of £285 and an average annual additional cost of £115.
Tags:
HMRC Making Tax Digital April 2026 Deadline, Making tax digital, Making Tax Digital reporting, MTD for Income Tax UK Landlords, MTD software
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Member Since January 2024 - Comments: 351
11:28 AM, 5th February 2026, About 3 months ago
With all the additional licencing fees, software costs for MTD ITSA, ever increasing regulatory obligations, upcoming EPC requirements, etc, it is becoming increasingly expensive to be a landlord. Any increase in rent is only likely to cover our increased costs (and we should not treat all our time as free, we have to put a value on it!).
The Renter’s Rights Act is the final nail in the coffin. We could be waiting a year for a rent increase (which may only cover increased costs, so no benefit to us) and then the tribunal could reject the increase. Even if they accept the increase it only applies from the date of their decision!
I am now selling off my BTL properties as they come off any fixed rates. I will probably be better off putting the money in tracker funds, and certainly a lot less risk and hassle.
Member Since October 2023 - Comments: 205
12:48 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Simon Lever – Chartered Accountant helping clients get the best returns from their properties at 05/02/2026 – 11:25
I had a look at Gov.UK and it seems the confusion comes from those in care being exempt.
Some loon must think all pensioners are in care!
Member Since February 2022 - Comments: 206
12:57 PM, 5th February 2026, About 3 months ago
Personally I don’t really see this as much of an issue. I’m confident self-managing and booking keeping anyway and need to submit annually regardless. Yes it’s pointless submitting every quarter but if you do this yourself wouldn’t it make sense to…
1) Open free Mettle bank account.
2) Switch property/SE income to this account.
3) FeeAgent is then “free” and MTD ready
4) Use Mettle/Freeagent moving forward at £0 cost.
5) Only annoying thing is submitting every quarter rather than yearly.
I agree this is an extra cost if you pay account/book keeper but surely they should just charge you the annual fee split into 4 as they are doing the same work they would do in 1 year split quarterly?
Member Since January 2024 - Comments: 351
1:14 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jason at 05/02/2026 – 12:57
Doing something 4x a year is generally less efficient for an accountant/bookkeeper than doing something once a year, so the cost is likely to be higher.
Then of course you may also need quarterly for rental income and quarterly for self-employed income.
And don’t forget that thee may be some solely owned properties and some jointly owned.
For me, not a huge hassle, but a lot of people will find it difficult to cope.
Member Since February 2022 - Comments: 206
1:28 PM, 5th February 2026, About 3 months ago
Agree jointly owned is a pain. I think quarterly vs yearly is more efficient anyway and maybe the bigger scope from HMRC is to move to a quarterly model once all systems are in place. Perhaps this is their future for tax just like VAT returns.
Member Since January 2024 - Comments: 351
2:12 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jason at 05/02/2026 – 13:28
Obviously the end game is to move on to quarterly payments. Although they have been very quiet about this being in their plans.
For most small landlords (in and around London £50k may just be a couple of properties) quarterly filing makes no sense. It is 100% more work for Nil benefit. Quicker just to download a csv file once a year and enter once on a tax return.
For larger portfolios most landlords will probably be doing some sort of regular accounting anyway, so maybe not a huge change, apart from penalties.
Either way, it makes no sense, unless the end game is quarterly payments and revenue from penalties.
Member Since June 2015 - Comments: 333
2:51 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jason at 05/02/2026 – 13:28
Software such as Hammock and Landlord Vision cope with joint ownership, sold ownership, unequal ownership, etc perfectly well.
It will produce figures for each individual owner.
Setting them up takes a few hours but once set up they allocate everything to each owner, so producing the quarterly submissions for each individual should be easy.
It’s questionable how correct the quarterly reports will actually be, as so many aspects only get dealt with on the end of year submission.
Member Since January 2024 - Comments: 351
3:17 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jo Westlake at 05/02/2026 – 14:51
Unfortunately, Hammock and LV are relatively expensive products and only really for more complex cases.
HMRC envisaged there being lots of free software and MTD ITSA being a minimal cost and inconvenience to taxpayers. ROFL!!
Member Since February 2022 - Comments: 206
4:27 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jo Westlake at 05/02/2026 – 14:51
LLV is great if you signed up before 2023 however the newer MTD version is too expensive for non portfolio landlords. Hence why I suggest for some that self manage the Mettle/FreeAgent route is a free and easy option.
Member Since January 2024 - Comments: 351
5:07 PM, 5th February 2026, About 3 months ago
Reply to the comment left by Jason at 05/02/2026 – 16:27
It is probably only free as long as you stay with the bank.
Quickfile is very low cost and is independent of the bank (I have no connection with them, I just use Quickfile for simple sets of accounts).
Also, Lime Books is quite low cost.
Not designed specifically for landlords, but should be fine for small landlords/non-complex cases.