Landlords have been encouraged to sign up to HMRC’s testing programme, with less than a year to go until those earning more than £50,000 need to use Making Tax Digital (MTD) for Income Tax.

From April 2026, all those landlords will need to keep digital records, use MTD-compatible software and submit quarterly summaries of their income and expenses to HMRC.

Quarterly updates aim to spread the workload more evenly throughout the year, bring the tax system closer to real-time reporting and help businesses stay on top of their finances and avoid the last-minute rush.

Qualifying income includes gross income from self-employment and property before any tax allowances or expenses are deducted. Those with qualifying income above £30,000 will need to use the new digital system from April 2027 and the threshold will then fall to £20,000 from April 2028.

Making Tax Digital

Craig Ogilvie, HMRC’s director of Making Tax Digital, says MTD for Income Tax 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.

“By signing up to our testing programme now, self-employed people and landlords will be able to familiarise themselves with the new process and access dedicated support from our MTD Customer Support Team, before it becomes compulsory next year,” he adds.

The phased introduction of MTD for Income Tax follows the introduction of MTD for VAT. The Government says those firms which joined its testing phase were better prepared for the move to quarterly reporting.

Landlords have already been told they will have to fork out an extra £110 each per year to use the new system, including the cost of software subscriptions and the additional hours spent updating their records every quarter.

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