It’s me again getting in a state about MTD?
1 month ago | 36 comments
Landlords could face monthly HMRC tax bills
9:03 AM, 15th July 2026, 4 weeks ago
27
Landlords could be required to pay tax every month under Treasury proposals that would calculate deductions using income declared in the previous year, the Daily Telegraph reports.
The move comes after the controversial Making Tax Digital (MTD) is already forcing thousands of property owners into a new quarterly reporting regime.
The government is consulting on plans that could allow HMRC to collect tax before some landlords and self-employed workers have received the income needed to pay it.
Monthly deductions would be based on the taxpayer’s previous annual return, with the resulting forecast liability divided into 12 payments.
Someone whose last return showed earnings of £30,000 could, for example, face deductions of £290 a month.
Planned for 2030
The system would apply to people earning above a threshold that has not yet been decided.
Labour plans to introduce the monthly payment regime from April 2030.
For landlords, the proposal could create problems where income changes sharply between tax years or varies during the year.
Voids, repairs, mortgage costs and late rent payments can all affect a landlord’s cashflow in any month.
Paying tax in poor cashflow
Zena Hanks, of accountancy firm Saffery, told the Telegraph: “For the self-employed, this is going to cause huge disruption to cashflow.
“The principles are sound, ensuring tax is paid closer to income being received, but you can’t predict future income easily.”
Self-employed taxpayers currently make payments on account twice a year, normally in January and July, based on their previous tax return.
Ms Hanks added: “It’s all very well HMRC issuing refunds, but taxpayers could have to pay more tax at a time when their business is under pressure.”
Making Tax Digital
The proposal follows the introduction of Making Tax Digital for Income Tax in April.
Eligible landlords and self-employed workers must now use HMRC-approved software and submit financial information four times a year.
The regime currently applies where qualifying income exceeds £50,000.
The threshold will fall to £30,000 next year and £20,000 from 2028.
Want landlord views
However, while quarterly submissions do not replace the annual tax return process, they do add another layer of record-keeping for landlords.
Making Tax Digital was delayed four times and ran £1bn over budget.
Its rollout has also prompted concern about whether HMRC could manage another major change to the way tax is reported and collected.
An HMRC spokesman told the newspaper: “Spreading tax payments more evenly through the year could help taxpayers avoid unexpected lump-sum bills and reduce the risk of falling into tax debt.
“We recognise that self-employed people and landlords can have fluctuating incomes, which is why we are consulting widely as we want to hear views on how potential reforms could work in practice.”
Tags:
HMRC landlord tax, landlord income tax, landlord monthly tax payments, Making Tax Digital landlords, property income tax, self-employed tax reform
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Member Since May 2018 - Comments: 2354
8:37 AM, 16th July 2026, About 4 weeks ago
Reply to the comment left by Minu Alunel at 15/07/2026 – 21:36
And why monthly? If you are VAT registered you can submit quarterly and pay the VAT quarterly.
But the truth is that if a limited company can pay corporation tax nine months after its year end there’s nothing wrong with a small portfolio landlord completing the fiscal year in April and handing over the tax due by the following January. Anything else is just persecution.
Member Since April 2023 - Comments: 179
7:53 AM, 18th July 2026, About 3 weeks ago
Reply to the comment left by Si BB at 15/07/2026 – 09:57
The income threshold would have to be very high for it not to make a difference to someone. For example when I pay my insurance it more than my income that month. I’m paying double council tax on one property at the moment alongside the utility bills for that property which is hard going. If I need to decorate the outside of my property the scaffold alone is 4K (last time). So basically it would be impossible for me.
Member Since April 2025 - Comments: 12
9:40 AM, 18th July 2026, About 3 weeks ago
This is a nuisance because we keep our property self-assessments separate from our monthly pensions. We have a separate account that everything to do with our property portfolio goes through rather than our normal everyday account.
Member Since September 2015 - Comments: 1035
9:47 AM, 18th July 2026, About 3 weeks ago
Reply to the comment left by Valerie Hollylee at 18/07/2026 – 09:40
My accountant said I only have to submit property related financials for quarterly MTD submissions. This has just been done for my first quarters MTD. No comeback from HMRC so far
Member Since November 2022 - Comments: 12
12:10 AM, 19th July 2026, About 3 weeks ago
Ridiculous click-bait
Member Since December 2023 - Comments: 1
4:20 AM, 19th July 2026, About 3 weeks ago
I wish there were fewer articles like this as this is nothing but inflicting further unnecessary pain on landlords. There is no fact nor substance to the story. It only more hint to the government to further punish the hardworking landlords, most of whom worked hard to get where they are and the government wants a huge chuck of their hardworked earnings for their gain
Member Since May 2018 - Comments: 2354
11:52 AM, 20th July 2026, About 3 weeks ago
This is absolutely correct: The article published here quotes a government consultation but doesn’t provide a link to where the consultation is. Perhaps one of the admins would like to add a link to the consultation.
The MTD proposals are for any income from property and self-employment together, over certain thresholds.
But the truth about MTD is that if a limited company can pay it’s corporation tax 9 months and 1 day after its financial year end, then along with George Osborne’s changes resulting in non-incorporated landlords being unable to offset their finance costs against their rents, the MTD proposals are just persecution of small portfolio landlords and the self-employed. The only thing that small portfolio landlords can do in response to mitigate the negative effects of the MTD proposals upon them is to raise rents. Nothing about these proposals benefits tenants and in fact all that punitive measures like this imposed upon landlords do is restrict tenant choice, increase the costs of renting and raise rents.
It is government that is pushing rents up; Portugal has just had to back-track on this kind of persecution and control-freakery.