{"id":10471,"date":"2025-08-18T17:00:48","date_gmt":"2025-08-18T16:00:48","guid":{"rendered":"https:\/\/www.sage.com\/en-gb\/blog\/?p=10471"},"modified":"2025-12-18T12:04:10","modified_gmt":"2025-12-18T12:04:10","slug":"self-assessment-making-tax-digital-income-tax-landlords","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-gb\/blog\/self-assessment-making-tax-digital-income-tax-landlords\/","title":{"rendered":"Self Assessment and Making Tax Digital: What MTD for Income Tax means for landlords"},"content":{"rendered":"<header class=\"entry-header has-dark-background-color entry-header--has-illustration entry-header--has-illustration--generic\">\n\t<div class=\"container\">\n\t\t<div class=\"entry-header__row row align-center\">\n\t\t\t<div class=\"col col-lg-7 col-xlg-6 entry-header__content\">\n\t\t\t\t\t\t\t<div class=\"component component-single-header\">\n\t\t\t\t\t\t\t\t\t\t<div class=\"entry-header__misc text--subtitle text--uppercase text--small\">\n\t\t\t\t\t\t\t<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/category\/money-matters\/\" class=\"entry-header__link\">Money Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t<div class=\"entry-title-wrapper\">\n\t\t\t\t\t<h1 class=\"entry-title\">\n\t\t\t\t\t\tSelf Assessment and Making Tax Digital: What MTD for Income Tax means for landlords\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t<p class=\"entry-header__description\">\n\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n\t<div class=\"single-post-details container\">\n\t\t<div class=\"col\">\n\t\t\t<span class=\"posted-on \"><time class=\"entry-date published\" datetime=\"2025-08-18T17:00:48+01:00\">18 August, 2025<\/time><\/span><span class=\"reading-time\"> min read<\/span>\n\t\t<button\n\t\t\ttype=\"button\"\n\t\t\tclass=\"social-share-button button button--icon button--secondary js-social-share-button\"\n\t\t\tdata-share-title=\"Self Assessment and Making Tax Digital: What MTD for Income Tax means for landlords\"\n\t\t\tdata-share-url=\"https:\/\/www.sage.com\/en-gb\/blog\/self-assessment-making-tax-digital-income-tax-landlords\/\"\n\t\t\tdata-share-text=\"Please read this interesting article\"\n\t\t>\n\t\t\t<span class=\"social-share-button__share-label\">Share<\/span>\n\t\t\t<span class=\"social-share-button__copy-label\" hidden>Copy Link<\/span>\n\t\t\t<span class=\"social-share-button__copy-tooltip\" aria-hidden=\"true\" hidden>Copied<\/span>\n\t\t<\/button>\n\n\t\t\t\t<\/div>\n\t<\/div>\n<\/header>\n\n\n\n<div class=\"wp-block-post-author\">\n\t\t\t<div class=\"co-authors\">\n\t\t\t\n\t\t<div class=\"entry-author-wrapper\">\n\t\t\t<a class=\"entry-author\" href=\"https:\/\/www.sage.com\/en-gb\/blog\/author\/keirthomasbryant\/\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"40\" height=\"40\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/06\/keir-short-hair-350x350.jpg\" class=\"entry-author__image\" alt=\"\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/06\/keir-short-hair-350x350.jpg 350w, https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/06\/keir-short-hair.jpg 760w\" sizes=\"auto, (max-width: 40px) 100vw, 40px\" \/>\t\t\t\t<span class=\"entry-author__name\">Keir Thomas-Bryant<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t<\/div>\n\t\t<\/div>\n\n\n\n\n\n<p>Is it really the end of Self Assessment for landlords? Discover how property income will be affected by Making Tax Digital for Income Tax.<\/p>\n\n\n\n<p>Have you heard that Self Assessment might be coming to an end?<\/p>\n\n\n\n<p>And that the need for you to file an annual tax return might be on its way out?<\/p>\n\n\n\n<p>Well, back in 2015, the then-Chancellor announced the death of the tax return. This would be achieved, he added, by the digitalisation of taxes.<\/p>\n\n\n\n<p>It would mean the end of the&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/file-a-tax-return-online\/\">Self Assessment tax return<\/a>, used by many landlords to declare rental income among other things.<\/p>\n\n\n\n<p>It\u2019s taken a little longer than anticipated but this is now happening.<\/p>\n\n\n\n<p>The&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/making-tax-digital\/\">Making Tax Digital<\/a>&nbsp;(MTD) revolution will soon encompass non-incorporated landlords (those who own and rent out properties as individuals, rather than as limited companies).<\/p>\n\n\n\n<p>This will be via the&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/mtd-for-income-tax-sole-traders\/\">Making Tax Digital for Income Tax<\/a>&nbsp;(also known as MTD for Income Tax, and MTD for Income Tax Self Assessment) system.<\/p>\n\n\n\n<p>It all begins as of 6 April 2026.<\/p>\n\n\n\n<p>Initially, it will only affect those with property income over \u00a350,000 (along with&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/self-assessment-ending-making-tax-digital-sole-traders\/\">sole traders<\/a>) creating a requirement for earnings to be declared.<\/p>\n\n\n\n<p>From 6 April 2027, those with property income over \u00a330,000 will also be affected.<\/p>\n\n\n\n<p>And from April 2028, it will include those who earn more than \u00a320,000, as announced in the 2025 Spring Statement.<\/p>\n\n\n\n<p>Let\u2019s take a look at what landlords need to know. <\/p>\n\n\n\n<p>Here\u2019s what we cover:<\/p>\n\n\n<?xml encoding=\"utf-8\" ?><div class=\"wp-block-yoast-seo-table-of-contents yoast-table-of-contents\"><ul><li><a href=\"#h-how-self-assessment-for-landlords-works-now\" data-level=\"2\">How Self Assessment for landlords works now<\/a><\/li><li><a href=\"#h-what-allowable-expenses-are-there-for-landlords\" data-level=\"2\">What allowable expenses are there for landlords?<\/a><\/li><li><a href=\"#h-how-making-tax-digital-will-change-things-for-landlords\" data-level=\"2\">How Making Tax Digital will change things for landlords<\/a><\/li><li><a href=\"#h-what-does-making-tax-digital-mean-for-landlords\" data-level=\"2\">What does Making Tax Digital mean for landlords?<\/a><ul><li><a href=\"#h-1-landlords-need-to-use-software-for-their-accounting\" data-level=\"3\">1. Landlords need to use software for their accounting<\/a><\/li><li><a href=\"#h-2-landlords-need-to-provide-periodic-updates-to-hmrc\" data-level=\"3\">2. Landlords need to provide periodic updates to HMRC<\/a><\/li><li><a href=\"#h-3-landlords-need-to-provide-a-digital-tax-return\" data-level=\"3\">3. Landlords need to provide a digital tax return<\/a><\/li><\/ul><\/li><li><a href=\"#h-am-i-a-professional-landlord\" data-level=\"2\">Am I a professional landlord?<\/a><\/li><li><a href=\"#h-what-if-i-m-a-sole-trader-and-a-landlord\" data-level=\"2\">What if I&rsquo;m a sole trader and a landlord?<\/a><\/li><li><a href=\"#h-why-making-tax-digital-can-make-life-easier-for-landlords\" data-level=\"2\">Why Making Tax Digital can make life easier for landlords<\/a><\/li><li><a href=\"#h-self-assessment-versus-mtd-for-income-tax-what-s-required\" data-level=\"2\">Self Assessment versus MTD for Income Tax: What&rsquo;s required?<\/a><\/li><li><a href=\"#h-what-landlords-can-do-now-to-prepare\" data-level=\"2\">What landlords can do now to prepare<\/a><\/li><li><a href=\"#h-where-to-get-support-with-tax-return-changes\" data-level=\"2\">Where to get support with tax return changes<\/a><\/li><li><a href=\"#h-final-thoughts\" data-level=\"2\">Final thoughts<\/a><\/li><li><a href=\"#h-frequently-asked-questions-on-landlords-and-making-tax-digital\" data-level=\"2\">Frequently asked questions on landlords and Making Tax Digital<\/a><ul><li><a href=\"#h-can-i-do-my-making-tax-digital-tax-returns-myself-rather-than-hire-an-accountant\" data-level=\"3\">Can I do my Making Tax Digital tax returns myself rather than hire an accountant?<\/a><\/li><\/ul><\/li><\/ul><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-how-self-assessment-for-landlords-works-now\">How Self Assessment for landlords works now<\/h2>\n\n\n\n<p>Some landlords run property businesses as their sole occupation, while others may have purchased one or more buy-to-let properties as a sideline to their main income.<\/p>\n\n\n\n<p>Some may have inherited a property that they let out, or perhaps even live in a property while renting out a part of it.<\/p>\n\n\n\n<p>Those landlords who don\u2019t own and run the property (or a property portfolio) through a limited company typically must use a yearly Self Assessment&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/self-assessment-tax-return-file-tips\/\">tax return<\/a>&nbsp;to declare their property income.<\/p>\n\n\n\n<p>Since this is a form of income, it\u2019s no surprise that income tax applies. Using&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/sage-business-cloud\/accounting\/features\/self-assessment\/\">Self Assessment<\/a>&nbsp;means they can work out how much tax and National Insurance is due.<\/p>\n\n\n\n<p>How much they pay will therefore depend on their personal circumstances.<\/p>\n\n\n\n<p>For example, they may be taxed on this income at a higher rate because of their day job, where their salary is paid by their employer through PAYE.<\/p>\n\n\n\n<p>The great news is that the first \u00a31,000 from property income (called the property allowance) may be tax-free. If you receive between \u00a31,000 and \u00a32,500 from property, you might not need to use Self Assessment either and should contact HMRC for more information.<\/p>\n\n\n\n<p>It\u2019s a good idea to check the Self Assessment guidelines every year.<\/p>\n\n\n\n<p>However, you must use Self Assessment if the income is:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>\u00a32,500 to \u00a39,999 after allowable expenses<\/li>\n\n\n\n<li>\u00a310,000 or more before allowable expenses.<\/li>\n<\/ul>\n\n\n\n<div class=\"single-cta gated-content\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">E-Book: Your Guide to MTD for Income Tax<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p><!-- wp:paragraph --><\/p>\n<p>Our free guide is written by experts and is all you need as a sole trader or landlord to understand what MTD means for your business\u2014and how to ensure you&#8217;re ready in time.<\/p>\n<p><!-- \/wp:paragraph --><\/p>\n<p><!-- wp:paragraph --><\/p>\n<p><!-- \/wp:paragraph --><\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-626d6b26-aa95-4f75-a5a0-9cce8bff833f\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Get Your Guide to MTD for Income Tax<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"800\" height=\"450\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/10\/cta-mtd-guide.jpg\" class=\"single-cta__image\" alt=\"A woman reading a guide about MTD for Income Tax\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/10\/cta-mtd-guide.jpg 800w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-allowable-expenses-are-there-for-landlords\">What allowable expenses are there for landlords?<\/h2>\n\n\n\n<p>Buying, renovating or improving properties isn\u2019t included, unfortunately.<\/p>\n\n\n\n<p>However, wear and tear repairs between tenants can probably be claimed, as can repairs or maintenance that returns the property back to an original condition before the damage (such as &nbsp;replacing roof tiles that blew off or replacing a boiler).<\/p>\n\n\n\n<p>But the rules around what counts as repairs and maintenance, and what\u2019s considered as actually improving a property, are complicated.<\/p>\n\n\n\n<p>You&nbsp;<a href=\"https:\/\/www.gov.uk\/guidance\/income-tax-when-you-rent-out-a-property-working-out-your-rental-income\">should check<\/a>&nbsp;the rules before making a claim.<\/p>\n\n\n\n<p>Other&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/allowable-expenses-self-assessment-tax-return\/\">allowable expenses<\/a>&nbsp;for landlords include things you expend money for in the day-to-day running of the property, such as:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Fees, such as letting agents, accountants and legal fees (for lets of a year or less, or renewing a lease for less than 50 years)<\/li>\n\n\n\n<li>Insurance (buildings and contents)<\/li>\n\n\n\n<li>Bills such as gas, water, electricity, and council tax<\/li>\n\n\n\n<li>Ground rent and service charges<\/li>\n\n\n\n<li>Professional property services you employ, such as a gardener or cleaner<\/li>\n\n\n\n<li>Other costs relating to running a business, such as stationery or advertising.<\/li>\n<\/ul>\n\n\n\n<p>Relief on interest on the mortgage for a buy-to-let residential property can\u2019t be claimed as an expense of the business. But if it\u2019s included on the Self Assessment return separately, a tax reduction may apply.<\/p>\n\n\n\n<div class=\"single-cta\">\n\t<a\n\t\tclass=\"button button--primary gate-a94bee60-b187-4ba5-a9a6-088ae18bd836\"\n\t\trole=\"button\"\n\t\tdata-button-location=\"content_area\"\n\t\thref=\"#gate-a94bee60-b187-4ba5-a9a6-088ae18bd836\"\n\t>Get answers to questions you may have on Self Assessment and tax returns in this free guide<\/a>\n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-how-making-tax-digital-will-change-things-for-landlords\">How Making Tax Digital will change things for landlords<\/h2>\n\n\n\n<p>MTD brings new requirements for how landlords do their accounting relating to property income, and as such can make things much simpler and give you a much clearer insight into your property business finances.<\/p>\n\n\n\n<p>MTD for Income Tax marks the end of the Self Assessment tax return if income from the property is over \u00a350,000 from April 2026, over \u00a330,000 from 2027, and over \u00a320,000 from 2028.<\/p>\n\n\n\n<p>These individuals will be required to use MTD for Income Tax instead, which unlike Self Assessment, is a digital-only submission.<\/p>\n\n\n\n<p>Those who fall below these thresholds will continue to use Self Assessment without significant landlord tax changes.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.sage.com\/en-gb\/blog\/mtd-income-tax-landlords-need-to-know\/\">MTD for landlords<\/a>&nbsp;doesn\u2019t change how tax works for landlords, as so much of what\u2019s already been described remains true. However, MTD does provision for sole trader income and landlord income to be combined in its threshold.<\/p>\n\n\n\n<p>The Government has also <a href=\"https:\/\/www.gov.uk\/government\/publications\/furnished-holiday-lettings-tax-regime-abolition\/abolition-of-the-furnished-holiday-lettings-tax-regime\">changed the rules<\/a> for landlords letting or selling holiday rentals effective from 6 April 2025, which brings all landlord income into the same scope.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-does-making-tax-digital-mean-for-landlords\">What does Making Tax Digital mean for landlords?<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-1-landlords-need-to-use-software-for-their-accounting\">1. Landlords need to use software for their accounting<\/h3>\n\n\n\n<p>To declare your taxes correctly, you must use software for your accounting relating to property income and keep the accounting records digitally.<\/p>\n\n\n\n<p>Using software could mean using a spreadsheet, but this will require&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/glossary\/what-is-a-bridging-tool-or-bridging-software\/\">bridging software<\/a>&nbsp;to be able to communicate with HMRC.<\/p>\n\n\n\n<p>Many landlords will use&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/sage-business-cloud\/accounting\/features\/self-assessment\/\">MTD-ready accounting software<\/a>, which will free up an enormous amount of time otherwise spent on admin.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-2-landlords-need-to-provide-periodic-updates-to-hmrc\">2. Landlords need to provide periodic updates to HMRC<\/h3>\n\n\n\n<p>You must provide periodic updates to HMRC across the year. These should be least quarterly (that is, every three months), and must be submitted via software. Your accountant or bookkeeper can do this for you, if you wish.<\/p>\n\n\n\n<p>This is for all your property income. You don\u2019t need to create period updates for each individual property if you have a portfolio; although if you hold property abroad, then you do them for all UK property, and separately for any foreign property..<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-3-landlords-need-to-provide-a-digital-tax-return\">3. Landlords need to provide a digital tax return<\/h3>\n\n\n\n<p>By 31 January each year, at the latest, you must submit a digital tax return to HMRC. This single tax return details all your income and expenditure, and is what&#8217;s used to determine your tax liability. It should include any other income you might receive, too. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-am-i-a-professional-landlord\">Am I a professional landlord?<\/h2>\n\n\n\n<p>The first phase of MTD for Income Tax affects any unincorporated landlord with rental income over \u00a350,000. And the second phase affects those earning over \u00a330,000, while the third phase covers those earning over \u00a320,000.<\/p>\n\n\n\n<p>HMRC considers these people to be running a business.<\/p>\n\n\n\n<p>This remains true even if it might not feel like you\u2019re running a business.<\/p>\n\n\n\n<p>For example, somebody who rents out an inherited property or holiday letting, or expends the equivalent of just a few days of work a year attending to the property and its tenants is still considered to be running a business.<\/p>\n\n\n\n<p>Similarly, those renting out part of the home might also be affected.<\/p>\n\n\n\n<p>Put simply, if total rental or combined rental and self-employment income you receive is over either threshold, you\u2019ll need to follow the rules of MTD for Income Tax from the appropriate date.<\/p>\n\n\n\n<p>HMRC defines professional landlords in the following way (all of these points must apply to the individual):<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Being a landlord is their main job<\/li>\n\n\n\n<li>They rent out more than one property<\/li>\n\n\n\n<li>They\u2019re buying new properties to rent out.<\/li>\n<\/ul>\n\n\n\n<p>In addition to potentially following MTD for Income Tax rules, these people may also need to pay Class 2 National Insurance contributions if their profits are above \u00a36,725 a year.<\/p>\n\n\n\n<p>The definition of a professional landlord predates the introduction of MTD for Income Tax, but is carried over when the new rules come into effect.<\/p>\n\n\n\n<p>Furthermore, those who rent out part of a property that\u2019s their only or main home are known as&nbsp;<a href=\"https:\/\/www.gov.uk\/rent-room-in-your-home\">resident landlords<\/a>.<\/p>\n\n\n\n<p>Again, these individuals might need to follow the MTD for Income Tax rules if the rental income is over the thresholds, just as they need to use Self Assessment currently once their property income gets above \u00a37,500 annually (assuming they\u2019re registered under the Rent a Room scheme).<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-if-i-m-a-sole-trader-and-a-landlord\">What if I\u2019m a sole trader and a landlord?<\/h2>\n\n\n\n<p>If you\u2019re a&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/sole-trader-guide\/\">sole trader<\/a>, running one or more businesses and using Self Assessment, then MTD for Income Tax could apply to your income.<\/p>\n\n\n\n<p>If you\u2019re both a sole trader and a landlord, then your total income from all sources is taken into account when working out if MTD for Income Tax applies to you.<\/p>\n\n\n\n<p>For example, if your income is \u00a340,000 a year as a plumber and \u00a310,000 from property rental, then MTD for Income Tax will apply to both your income as a plumber and your property income\u2014even though the property income taken on its own isn\u2019t over the threshold.<\/p>\n\n\n\n<p>You\u2019ll have to make separate periodic updates and for the property income, and for any sole trader business(es) you own. You only need to submit a single digital tax return, though, that will list all your income and expenditure. <\/p>\n\n\n\n<p>For example, if you work as a sole trader plumber and also as an electrician, and receive property income, you\u2019ll need to submit quarterly updates for each income source, listing all your income and expenditure. Then by 31 January each year, you will submit a digital tax return. <\/p>\n\n\n\n<div class=\"single-cta\">\n\t<a\n\t\tclass=\"button button--primary gate-a94bee60-b187-4ba5-a9a6-088ae18bd836\"\n\t\trole=\"button\"\n\t\tdata-button-location=\"content_area\"\n\t\thref=\"#gate-a94bee60-b187-4ba5-a9a6-088ae18bd836\"\n\t>Get answers to questions you may have on Self Assessment and tax returns in this free guide<\/a>\n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-why-making-tax-digital-can-make-life-easier-for-landlords\">Why Making Tax Digital can make life easier for landlords<\/h2>\n\n\n\n<p>Landlords must keep&nbsp;<a href=\"https:\/\/www.gov.uk\/keeping-your-pay-tax-records\/rental-income\">certain kinds of records<\/a>, such as details of rent received, plus invoices, bank statements, and more.<\/p>\n\n\n\n<p>But Self Assessment makes no demands on how you keep your accounting\u2014or even if you need to bother doing so.<\/p>\n\n\n\n<p>This changes with MTD for Income Tax.<\/p>\n\n\n\n<p>And that\u2019s a good thing.<\/p>\n\n\n\n<p>The use of modern accounting software provides incredible insight into&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/manage-business-finances\/\">business finances<\/a>&nbsp;making it easier than ever to be stress-free MTD landlords.&nbsp;<\/p>\n\n\n\n<p>You\u2019ll also have a far better idea of how much tax you owe at any given moment too.<\/p>\n\n\n\n<p>Many of the additional processes required for MTD for Income Tax will be automated, provided you use&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/sage-business-cloud\/accounting\/features\/self-assessment\/\">good-quality accounting software<\/a>.<\/p>\n\n\n\n<p>For your periodic updates, it\u2019ll simply be a matter of tapping a button to prepare the reports, checking the details to ensure everything is correct (and applying adjustments if necessary), then sending them off.<\/p>\n\n\n\n<p>If you use an accountant or bookkeeper, they can help with these processes.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-self-assessment-versus-mtd-for-income-tax-what-s-required\">Self Assessment versus MTD for Income Tax: What\u2019s required?<\/h2>\n\n\n\n<p>Outside of submitting the yearly Self Assessment tax return, using Self Assessment as a landlord doesn\u2019t present too many requirements.<\/p>\n\n\n\n<p>But to be compliant as a landlord with&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/mtd-for-income-tax-postponed\/\">MTD for Income Tax<\/a>, you\u2019ll need to use software for your accounting as it relates to property income.<\/p>\n\n\n\n<p>At its most simple, digitalising your property accounting could be using a spreadsheet plus a plugin known as&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/glossary\/what-is-a-bridging-tool-or-bridging-software\/\">bridging software<\/a>.<\/p>\n\n\n\n<p>You record income and expenditure details in the spreadsheet, and then tell the bridging software what the key cells are that it needs to use to prepare things such as periodic updatess.<\/p>\n\n\n\n<p>However, it\u2019s so easy to accidentally overtype a cell in a spreadsheet. But the main worry to consider is the rules around&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/what-is-an-mtd-digital-link\/\">digital linking<\/a>.<\/p>\n\n\n\n<p>MTD rules say the movement of data from one destination to another must be both digital and automated. Manually copying and pasting from one place to another is prohibited most of the time\u2014as incredible as that might sound. If HMRC finds out, you could be penalised.<\/p>\n\n\n\n<p>The solution is to use MTD-ready accounting software.<\/p>\n\n\n\n<p>This encourages basic accounting practices, such as using the software to submit invoices and record payments. Therefore, creating and submitting your quarterly updates will be easier.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-landlords-can-do-now-to-prepare\">What landlords can do now to prepare<\/h2>\n\n\n\n<p>To get ready for Making Tax Digital, you need to start using accounting software and keeping digital records.<\/p>\n\n\n\n<p>If you\u2019re not doing so already, you should be looking to switch to using some kind of software for your accounting. An accountant can advise you if you are unable to decide.<\/p>\n\n\n\n<p>Do so as soon as possible; don\u2019t leave it until the last moment.<\/p>\n\n\n\n<p>After all, in April 2026, April 2027 and April 2028, a lot of people will be contacting HMRC with problems trying to adapt to MTD\u2014and if you\u2019re already using software, you\u2019ll be in a far better position.<\/p>\n\n\n\n<p>Many landlords already rely upon accounting software. They can issue invoices with ease, reconcile their bank statement against their outgoings, and more.<\/p>\n\n\n\n<p>The software also grows with them, should they increase their property portfolio.<\/p>\n\n\n\n<p>Tracking income and expenditure for several properties can become complex\u2014but much less so if you\u2019re using good accounting software. And it means your accounting is always kept in a legally compliant digital way\u2014and for the required period (usually five years).<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Apps that help you stay on track<\/h3>\n\n\n\n<p>One tip is to <a href=\"https:\/\/www.sage.com\/en-gb\/size\/self-employed\/\">pick your financial reporting software<\/a> and use an app to record and start snapping receipts for expenditures, such as property repairs. This removes the need to enter any numbers manually.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.autoentry.com\/campaigns\/uk\/accountants-bookkeepers?utm_source=google&amp;utm_medium=paidsearch&amp;utm_campaign=Search_UK_Brand_B\/P_BOF&amp;campaignid=13446722856&amp;adgroupid=124129109500&amp;network=g&amp;device=c&amp;gad_source=1&amp;gclid=EAIaIQobChMIvuf26NbjigMVwZNQBh0QZiqcEAAYAiAAEgLKOPD_BwE\">AutoEntry<\/a> lets you use your phone or a computer and scanner to grab an image of the receipt. The information is then automatically extracted and can be sent straight to your accounting software.<\/p>\n\n\n\n<p>For example, if you buy something in a shop for your property and are handed a paper receipt, you can take a snap of it using your phone. The information such as the retailer details, amount, date, VAT amount, and so on, will be extracted automatically.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-where-to-get-support-with-tax-return-changes\">Where to get support with tax return changes<\/h2>\n\n\n\n<p>It\u2019s a good idea to get help when considering how your accounting will change once Making Tax Digital for Income Tax arrives.<\/p>\n\n\n\n<p>Seek out an accountant or tax advisor that specialises in property income and, in return, you get people with amazing experience of every aspect of tax and running a property business.<\/p>\n\n\n\n<p>But care needs to be taken.<\/p>\n\n\n\n<p>You can hand off a lot of the workload around MTD to your accountant once MTD for Income Tax is up and running. But you still need to use software to keep your accounting, and you need to keep your accounting records digitally.<\/p>\n\n\n\n<p>Your accountant will be able to advise the best way forward, and how best you can work with them.<\/p>\n\n\n\n<p>Contact your software vendor too. They will have a massive amount of experience with both tax and, unsurprisingly, accounting software.<\/p>\n\n\n\n<p>As MTD for Income Tax approaches, many will offer dedicated support where you can learn if the software you use is MTD-ready\u2014and what you\u2019ll have to do to make use of the MTD features.<\/p>\n\n\n\n<p>Finally, consider approaching professional landlord associations to see what their advice is.<\/p>\n\n\n\n<p>There\u2019s little doubt that applying the rules of MTD to a property business isn\u2019t like applying it to a sole trader business, and inside information could prove extremely useful.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-final-thoughts\">Final thoughts<\/h2>\n\n\n\n<p>Many landlords are sure to find the arrival of Making Tax Digital for Income Tax a surprise. For some, it might mean they have to start taking accounting more seriously than they might have done so previously.<\/p>\n\n\n\n<p>But it\u2019s important to focus on the positives, which includes a much better understanding of your property business finances, and a reduced requirement for onerous administrative tasks.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-frequently-asked-questions-on-landlords-and-making-tax-digital\">Frequently asked questions on landlords and Making Tax Digital<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">What if I am already earning through a PAYE job and earn over \u00a31,000 annual income as a landlord? Do I still have to declare it for MTD?<\/h3>\n\n\n\n<p>As a landlord, you should declare your earnings on a&nbsp;<a href=\"https:\/\/www.sage.com\/en-gb\/sage-business-cloud\/accounting\/features\/self-assessment\/\">Self Assessment form<\/a>&nbsp;annually if your income exceeds \u00a31,000, even if you are already taxed as a PAYE in your other job. <\/p>\n\n\n\n<p>You won&#8217;t need to switch to MTD until you reach its thresholds of first \u00a350,000 and then \u00a330,000 annually but keep an eye on proposed expansions to MTD, for example, to add a threshold that&#8217;s less than \u00a330,000 as you could eventually qualify.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-can-i-do-my-making-tax-digital-tax-returns-myself-rather-than-hire-an-accountant\">Can I do my Making Tax Digital tax returns myself rather than hire an accountant?<\/h3>\n\n\n\n<p>Yes, if you keep accurate digital records, usually via cloud accounting software to make it easier to compile and submit your quarterly updates and your digital tax return.<\/p>\n\n\n\n<p>Many digital accounting software providers are aimed at medium to large businesses, so make sure you find one that doesn\u2019t overcharge you for services you won\u2019t need as a sole trader and landlord.<\/p>\n\n\n\n<p>There are some limitations around how you keep your records. For example, using spreadsheets will no longer be acceptable as a way to collate financial information unless you use bridging software.<\/p>\n\n\n\n<p>Any on-desktop or paper records must be kept unchanged for five to seven years to ensure the data can be verified or you will risk getting into trouble with HMRC should it ask for your financial data.<\/p>\n\n\n\n<p><em>Editor\u2019s note: This article was first published in January 2022 and has been updated for relevance.<\/em><\/p>\n\n\n\n<div class=\"single-cta gated-content\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">E-Book: Your Guide to MTD for Income Tax<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p><!-- wp:paragraph --><\/p>\n<p>Our free guide is written by experts and is all you need as a sole trader or landlord to understand what MTD means for your business\u2014and how to ensure you&#8217;re ready in time.<\/p>\n<p><!-- \/wp:paragraph --><\/p>\n<p><!-- wp:paragraph --><\/p>\n<p><!-- \/wp:paragraph --><\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-626d6b26-aa95-4f75-a5a0-9cce8bff833f\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Get Your Guide to MTD for Income Tax<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"800\" height=\"450\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/10\/cta-mtd-guide.jpg\" class=\"single-cta__image\" alt=\"A woman reading a guide about MTD for Income Tax\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/10\/cta-mtd-guide.jpg 800w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n\n\n\n\n\n<div class=\"single-cta\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">Subscribe to the Sage Advice newsletter<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p>Join more than 500,000 UK readers and get the best business admin strategies and tactics, as well as actionable advice to help your company thrive, in your inbox every month.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-b1a63862-3fa0-4a5e-bb67-c76b88bbc6b8\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Subscribe now<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"1440\" height=\"810\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1073797282-1-1440x810.jpg\" class=\"single-cta__image\" alt=\"\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1073797282-1-1440x810.jpg 1440w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Is it really the end of Self Assessment for landlords? Discover how property income will be affected by Making Tax Digital for Income Tax.<\/p>\n","protected":false},"author":280,"featured_media":9188,"menu_order":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_sage_video":false,"post_featured_image_hide":false,"footnotes":""},"categories":[6],"tags":[135,30,206,27],"business_type":[4],"lilypad":[],"context":[],"industry":[],"persona":[73,74,75],"imagine_tag":[77,142,334,200,170,727,109],"coauthors":[369],"class_list":["post-10471","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-money-matters","tag-business-finances","tag-mtd-business","tag-need-to-know","tag-tax","business_type-small-business"],"sage_meta":{"region":"en-gb","author_name":"Keir Thomas-Bryant","featured_image":"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2021\/04\/GettyImages-996893540.jpg","imagine_tags":{"77":"Accounting software","142":"Making Tax Digital for businesses","334":"Making tax digital for income tax","200":"Payroll","170":"Self Assessment","727":"Self Assessment and Making Tax Digital for Income Tax","109":"Small business"}},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"Sage Advice UK","distributor_original_site_url":"https:\/\/www.sage.com\/en-gb\/blog","push-errors":false,"_links":{"self":[{"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/posts\/10471","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/users\/280"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/comments?post=10471"}],"version-history":[{"count":0,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/posts\/10471\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/media\/9188"}],"wp:attachment":[{"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/media?parent=10471"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/categories?post=10471"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/tags?post=10471"},{"taxonomy":"business_type","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/business_type?post=10471"},{"taxonomy":"lilypad","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/lilypad?post=10471"},{"taxonomy":"context","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/context?post=10471"},{"taxonomy":"industry","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/industry?post=10471"},{"taxonomy":"persona","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/persona?post=10471"},{"taxonomy":"imagine_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/imagine_tag?post=10471"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.sage.com\/en-gb\/blog\/api\/wp\/v2\/coauthors?post=10471"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}