Making Tax Digital not for Partnerships?

Good Morning All, I have just spent the Morning contemplating Making Tax Digital to find some very vague comments regarding partnerships.

I duly phoned HMRC, who, to my amazement, answered within 10 minutes.

They confirmed that anyone in a partnership does NOT have to comply with MTD yet!

It seemed too good to be true… Has anyone else raised this?

Hilda

Editor’s Note:

Please see >> https://www.property118.com/making-tax-digital-mtd-is-edging-closer-but-not-everyone-needs-to-worry-yet/

What HMRC told you is broadly correct for now; ordinary partnerships are not yet mandated into Making Tax Digital for Income Tax.

A lot of the confusion comes from the fact that HMRC keeps talking about “landlords and self-employed people” being brought into MTD from April 2026, but partnerships were quietly pushed back again and currently have no confirmed start date.

HMRC’s guidance says: “Partnerships will need to use Making Tax Digital for Income Tax in the future. But for now, you’ll carry on doing a Self Assessment tax return.”

So if the rental business itself is operated through a traditional partnership, the partnership income is presently outside mandatory MTD for Income Tax.

However, individual partners may still need to comply personally if they also have qualifying income outside the partnership. For example:

• personally owned rental property
• sole trader income
• freelance/self-employed earnings

HMRC’s developer guidance specifically says that a partner does not need to sign up “unless they have other MTD qualifying income, such as sole trader income or property income.”

At the moment, the mandatory MTD rollout from April 2026 applies mainly to individuals with:

• more than £50,000 gross self-employment and/or property income
• falling to £30,000 from April 2027
• with plans to reduce further to £20,000 later.

There is still an expectation that partnerships will eventually be brought into MTD, but HMRC has not announced a commencement date yet.

Useful HMRC guidance links:

• Check if you need to use Making Tax Digital for Income Tax
• How Making Tax Digital works
• Sign up for Making Tax Digital for Income Tax

So in short, if your rental business is genuinely run as a partnership and you have no other qualifying income streams personally, you may be outside mandatory MTD for now.