Landlords won’t be forced into Making Tax Digital – claims impact assessment

make up your mind are landlords a business in which case we want mortgage interest fully refunded.You would think this would be obvious in a Court of law!

I have already spent huge amounts trying to ensure I already for MTD.
When I ran my circumstances through the HMRC tool to help you find the right software it said a single suitable product didn’t exist and I would need to use more than one. That is plainly ridiculous. There is nothing especially unusual about my circumstances. I am part owner of a property portfolio, have PAYE earnings, interest on savings, dividends and contribute to a SIPP.
I am currently spending about £69 per month on Landlord Vision (which I like apart from the fact it gets our mortgage payments wrong on 2 of our properties as 2 of the owners made big lump sum mortgage payments due to Section 24 whereas the third owner didn’t). I’m also spending £24 a month on Hammock as I read lots of very positive comments about it. It’s good in many respects and I think it gets the mortgage payments right but it doesn’t send rent invoices to the tenants.

Now it seems I need to also find one or more other software products to do the very bog standard stuff the landlord focused software can’t do.
I’ve already tried Xero and couldn’t see a way of making it work for a multiple owner property portfolio. My accountant loves Xero and wanted to charge something like £150 an hour for training sessions on how to use it.
Whichever way you look at it, it’s a huge cost. The software fees are tax deductable, so that’s a loss of tax revenue for HMRC. The time spent learning how to use these systems and setting them up could be far more productively used.
It’s incredibly frustrating that after two years of trying to be ready for MTD I find the products I’ve been using aren’t fully up to the job and the only software my accountant likes is unfathomable for my situation.

Reply to the comment left by Jo Westlake at 10/09/2025 – 10:07
Hi Jo, I may be mistaken but I am pretty sure I read changes in recent years meant landlords with jointly owned property are exempt from making tax digital.

Do we know the grounds on which we can claim exemption from MTD?
Is it possible to be exempt for MTD on lettings income while your annual tax return is digital and has been for some years?

Reply to the comment left by Sam B at 10/09/2025 – 10:35
Sam – there is something about jointly owned properties being exempt. However, I own some of mine solely. Overall it’s a bit of a mix. I have some, my husband has one, we jointly own several, my son is part owner of 4.
I’m probably slightly below £50K on my solely owned stuff, but well over £30K, unless they mean genuine profit calculated in the traditional way without the Section 24 fantasy stuff. Is that figure turnover or profit? The article refers to earnings and property income, so could mean almost anything.

Reply to the comment left by Sue P at 10/09/2025 – 11:11
From what I have read the MTD threshold is based on turnover, ie total rental receipts, not rental income less profits.
So presume if total of your rental receipts is below the MTD threshold you just carry on declaring income and expenditure via self assessment.

Reply to the comment left by Jill Church at 10/09/2025 – 12:19
I understand the thresholds, but the article talks of applying for exemption.
I was asking if anyone knows what the grounds for that exemption are.

Reply to the comment left by Jo Westlake at 10/09/2025 – 10:07
Hi Jo

The software you have detailed is good at what it does. However, as with all software you have to make sure it has the tools that you require.

I have not used Landlord Vision (yet) but I hear good things about it.

I do use Hammock and it is more for landlords’ bookkeeping rather than property management, so it does not issue invoices. I am sure if you contact them this may be something they could incorporate into future updates.

Under MTD the software can be used to make quarterly submissions. However, after the end of the tax year it will be necessary to submit an MTD tax return. This will be different from your normal tax return as the information will be populated from the quarterly submissions that have been made.

The return will also need to include any PAYE income, dividends, interest, pensions etc. It may be possible to make these adjustments through your personal tax account but if you have an accountant then he should be able to combine all submissions into whatever software he uses.

The problem at the moment is that HMRC keep changing the goalposts and software companies are scrambling to keep up.

With regard to jointly owned properties it is your share of the gross rental income that is relevant. When your tax return is prepared HMRC will look at the figure in the return that is in the box for rents received. It is your figure that is relevant.

It is possible, for example, where there is a husband and wife who jointly own a property and the wife, say, owns other properties in her name for her to have to join MTD as her gross rents are over £50,000 whilst the husband does not need to join as his share of the rent is below £20,000.

Reply to the comment left by Simon Lever – Chartered Accountant helping clients get the best returns from their properties at 10/09/2025 – 12:57
Simon – You say “However, as with all software you have to make sure it has the tools that you require”.

How are we supposed to know what we require when this is totally new to us? We aren’t accountants or tax specialists.
Some landlords haven’t even progressed to spreadsheets.
My accountant hates anything that isn’t Xero, so is no help whatsoever in determining which software has all the tools I require. LV and Hammock are both supposed to integrate with Xero so I don’t know why she is still so negative.

It is hugely time consuming to learn how to use this software. They all work differently. I started out with the old version of Landlord Vision. It took 6 months of swearing and hundreds of hours of my time to become reasonably confident with it. Then they brought out the current version, which is more intuitive and generally easier to use. However, it had to be set up from scratch, which is time consuming. Plus I was one of the earliest users of this version and it had a lot of glitches, which made it very frustrating and even more time consuming. Now it’s working pretty well and the only issue I have is it won’t split some mortgage payments correctly.
I tried Xero, which I just couldn’t make work. Their customer support seems to be non existant. That’s one thing both LV and Hammock are very good at. The amount of questions I have asked LV in particular and they have patiently answered is huge.

Reply to the comment left by Sue P at 10/09/2025 – 12:42
Hi Sue, The exemptions from my understanding are 1 age
2 health
3 religous reasons
4 not reasonable for any other reason

However you can not just I am retired and over x age so you should be exempt if for eg you had a job with requirements similar to mtd
same with religous reasons you cannot say this if you use the internet for other purposes
not reasonable cannot be just because you would have to put more effort in.