If your gross rent plus any self-employment turnover came to more than £50,000 on your 2024/25 tax return, Making Tax Digital for Income Tax already applies to you. It started on 6 April 2026. The test is on turnover before expenses, not on profit, which is why it catches far more landlords than most people expect.
Guide · Updated September 2026
There are three thresholds and three start dates, and a different tax year decides each one. That last part is what catches people out: the return that puts you in scope was filed long before the obligation starts, so by the time the rules bite, the number that decided it is already history.
| Qualifying income | Tested on the return for | You are in from |
|---|---|---|
| Over £50,000 | 2024/25 | 6 April 2026 — already live |
| Over £30,000 | 2025/26 | 6 April 2027 |
| Over £20,000 | 2026/27 | 6 April 2028 |
HMRC's wording on the first band is blunt: you should have started using Making Tax Digital for Income Tax from 6 April 2026. The underlying law is the Income Tax (Digital Obligations) Regulations 2026, SI 2026/336, which runs to eight parts covering compatible software, timing, quarterly updates and returns, digital records, amendments, exemptions and the rest.
The measurement is always taken from the Self Assessment return you submitted in the previous tax year. So a landlord who crossed £30,000 for the first time in 2025/26 is mandated from 6 April 2027, even if the rent falls back the following year.
This is the single most misunderstood part of the regime. HMRC defines qualifying income as your total income from self-employment and property, before expenses — the amount otherwise known as turnover. Not profit. Not the figure at the bottom of your property pages.
A landlord with £45,000 of rent and £10,000 of mortgage interest is tested on £45,000, not on what is left afterwards. The second trap is that the two income types are added together. HMRC's own published example uses £25,000 of rental income plus £27,000 of self-employment income to reach £52,000 — in scope, on two sources neither of which would have got there alone.
Jointly owned property counts too, at your share. HMRC's position is that your share of the property income counts towards your qualifying income, so a property producing £50,000 of rent split equally between two owners contributes £25,000 to each of them.
A landlord has three lets producing £41,000 of gross rent, with £4,200 of running costs and £11,500 of mortgage interest. Alongside that she does freelance consultancy with £14,000 of turnover.
Her taxable property profit is £41,000 less £4,200 of running costs — mortgage interest is not deducted, see the Section 24 guide — so £36,800. After the interest is paid she is left with £25,300 of cash. But qualifying income is £41,000 + £14,000 = £55,000. She is over £50,000 and, if that was the picture on her 2024/25 return, she has been inside Making Tax Digital since 6 April 2026 despite never earning £50,000 from any one thing in her life. Figures are illustrative.
Several kinds of income are specifically not qualifying income, and leaving them out of the sum matters as much as putting the right things in. Employment income taxed through PAYE does not count. Nor does an individual's share of partnership profit, dividends including dividends from your own company, the State Pension, or private pensions. A landlord with £28,000 of rent, a £40,000 salary and a £9,000 pension is tested on £28,000.
Far less than the phrase suggests. A quarterly update is a summary of totals for each income and expense category for the period. HMRC's own description is that these are summaries, not tax returns, and that HMRC will not receive details of individual digital records such as a receipt or an invoice.
You also do not have to tidy anything up first. HMRC states plainly that you do not need to make any accounting or tax adjustments before sending a quarterly update. Capital allowances, private use adjustments, the finance cost reducer — none of that belongs in the quarter. It all happens once, at the year end.
| Standard quarterly period | Deadline |
|---|---|
| 6 April – 5 July | 7 August |
| 6 April – 5 October | 7 November |
| 6 April – 5 January | 7 February |
| 6 April – 5 April | 7 May |
The periods are cumulative from 6 April rather than three discrete months, which is why the second update covers 6 April to 5 October rather than July to October. If the 5th of the month is awkward for your bookkeeping you can elect for calendar quarters instead, running to 30 June, 30 September, 31 December and 31 March. The deadlines do not move: they are still the 7th of August, November, February and May.
No tax is paid quarterly. HMRC is explicit that Making Tax Digital does not change the way you pay tax or the dates that payments are due. Payments on account on 31 January and 31 July and the balancing payment on 31 January all continue exactly as before. Our landlord tax calendar sets the quarterly update deadlines alongside the payment dates so the two are not confused.
A persistent myth says quarterly updates replace Self Assessment. They do not. The return still exists and the deadline is unchanged: you must submit it by 31 January following the end of the relevant tax year. What changes is the route — the return is filed through your MTD-compatible software rather than through HMRC's online Self Assessment service.
Some of it arrives pre-filled. HMRC pre-populates employment, pension and state benefit income. Dividends, savings interest and chargeable gains are not pre-populated and remain yours to add. So a landlord inside the regime ends up with five submissions a year instead of one: four updates and a return. Our tax return service covers the year-end work, and property bookkeeping covers the quarters.
Late submission moves to a points-based system. One point per missed quarterly update or return; at four points a £200 penalty falls due, and a further £200 for every subsequent miss. The regime applies from the tax year you join Making Tax Digital, not from a fixed date.
There are no penalties for missing a quarterly update deadline for the 2026/27 tax year, but each update still has to be sent before you can submit the tax return. That rule covers the quarterly updates only. Penalties for a late return and for paying late still apply.
| How late the tax is paid | 2026/27 | 2027/28 |
|---|---|---|
| Up to 15 days | No late payment penalty | No late payment penalty |
| 16 to 30 days | 3% of the tax outstanding at day 15, or no penalty in your first year | 4% of the tax outstanding at day 15, or no penalty in your first year |
| 31 days or more | 3% at day 15, plus 3% at day 30, plus 10% a year on the balance | 4% at day 15, plus 4% at day 30, plus 10% a year on the balance |
In your first year under the new penalties you have 30 days from the due date to pay in full or contact HMRC to set up a payment plan before any late payment penalty applies. After the first year that period is 15 days. The 10% is an annual rate that keeps running while the tax is unpaid, so the cost of a long-outstanding balance is not capped by the two fixed percentages, and late payment interest is charged from the first day.
Two limits on the new late payment penalties are worth knowing. They do not apply to payments on account. And they do not apply to tax years before you joined: if you joined on 6 April 2026, your 2025/26 return and its balancing payment, both due on 31 January 2027, are under the current penalties, so the first balancing payment the new rules reach is the one for 2026/27, due on 31 January 2028.
Some exemptions apply without you doing anything. Qualifying income of £20,000 or less is the permanent one that will matter to most people once the third phase starts. The others in that permanent group are narrower: no National Insurance number before the start of the tax year, non-resident companies filing SA700, trusts filing SA900, personal representatives of a deceased person, Lloyd's members filing SA103L, and people who cannot provide information themselves and have a power of attorney or a legal deputy acting for them.
A second group is exempt until at least April 2027: anyone who claimed averaging relief, qualifying care relief, income from trusts or estates, or the remittance basis on their 2024/25 return. A third group is exempt beyond April 2027 — ministers of religion filing SA102M, Lloyd's members with self-employment income, and claimants of Married Couple's Allowance or Blind Person's Allowance.
Everything else is by application, on the ground that you are digitally excluded: that it is not reasonable for you to use compatible software because of age, health, religious belief, or because your location means you have no internet access. Applications are decided on their facts, and the exemption is not given simply because you would rather not.
HMRC's position is that partnerships do not currently need to use Making Tax Digital for Income Tax. A landlord who holds property through a partnership is outside the regime for that income, and no start date has been announced for bringing partnerships in.
Two things follow. First, a partnership profit share is not qualifying income for the individual partner's own test either, which can leave a landlord with substantial income and no obligation at all. Second, this is not a reason to reorganise. A partnership brings its own consequences across income tax, stamp duty and capital gains, and creating one to sidestep quarterly reporting is a serious step taken for a small reason.
We record your rent and costs per property, send the four updates on time, and prepare the year-end return from records kept through the year. Buzz Accounting is a Xero Gold Partner and a FreeAgent partner, and both are recognised by HMRC. The MTD service page sets out how it works, a free review will tell you which threshold and which April apply to you, and if HMRC has already signed you up, here is what to do next.
What has changed in landlord tax, the dates coming up, and one number worth checking on your own portfolio.
It depends on your qualifying income and the tax year that tests it. Over £50,000 on your 2024/25 return means you have been mandated since 6 April 2026. Over £30,000 on your 2025/26 return brings you in from 6 April 2027, and over £20,000 on your 2026/27 return from 6 April 2028. Qualifying income is measured on the Self Assessment return you submitted in the previous tax year, so the figure that decides it is already filed. Employment income, partnership profit shares, dividends, the State Pension and private pensions are all excluded from the test, and jointly owned property counts at your share of the rent rather than the whole.
Your rent. HMRC defines qualifying income as total income from self-employment and property before expenses, which is turnover rather than profit, and that single point puts far more landlords into Making Tax Digital than expect to be there. A landlord with £45,000 of rent and £10,000 of mortgage interest is tested on £45,000. Property and self-employment are then added together: HMRC's own published example combines £25,000 of rental income with £27,000 of self-employment income to reach £52,000 and bring the taxpayer into scope. Your share of jointly owned property counts towards the total, so a property producing £50,000 of rent split equally contributes £25,000 to each owner.
No. HMRC states that Making Tax Digital does not change the way you pay tax or the dates that payments are due. Payments on account remain due on 31 January and 31 July, and the balancing payment on 31 January, exactly as before. A quarterly update is a summary of totals for each income and expense category for the period, not a tax calculation, and HMRC does not receive individual receipts or invoices. You also do not need to make any accounting or tax adjustments before sending one, so capital allowances, private use adjustments and the finance cost reducer are all dealt with once at the year end rather than four times a year.
In the 2026/27 tax year there is no penalty for it, but the update still has to be sent before you can submit your tax return. That rule covers the updates only, not the tax return and not late payment. Late submission is points-based: one point for each missed return and, for tax years after 2026/27, each missed quarterly update, a £200 penalty once you reach four points, and a further £200 for every subsequent miss. Late payment is separate: for 2026/27 there is 3% of the tax outstanding at day 15, a further 3% at day 30 and 10% a year after that. In your first year under the new penalties you have 30 days to pay, or to set up a payment plan with HMRC, before a penalty applies. Payments on account are not covered.
Yes. Quarterly updates do not replace the return, they sit in front of it. The return still exists and the deadline is unchanged at 31 January following the end of the tax year, but it is filed through your Making Tax Digital software rather than through HMRC's online Self Assessment service. HMRC pre-populates employment, pension and state benefit income; dividends, savings interest and chargeable gains still have to be added by you. In practice a landlord inside the regime makes five submissions a year instead of one — four quarterly updates and the return — and every year-end adjustment happens in that final step.
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