Making Tax Digital for Landlords | MTD Guide 2026 | Greystone Accountants

by | Jul 1, 2026 | Tax

Making Tax Digital for Landlords: What UK Property Owners Need to Know in 2026

Is Your Rental Property Ready for Making Tax Digital?

For many landlords, 2026 marks one of the biggest changes to property taxation in years.

If you receive rental income, you’ll soon need to comply with Making Tax Digital (MTD) for Income Tax, changing the way you keep records and report your rental income to HMRC.

If you’re still relying on spreadsheets, paper records or only looking at your property accounts once a year, now is the time to prepare.

At Greystone Accountants, we’re helping landlords and property investors transition smoothly to the new system while identifying opportunities to reduce tax and improve profitability.

What is Making Tax Digital for Landlords?

Making Tax Digital (MTD) is HMRC’s programme to modernise the UK tax system.

Instead of submitting one annual Self Assessment tax return based on your rental income, many landlords will be required to:

  • Keep digital accounting records.
  • Use HMRC-compatible software.
  • Submit quarterly updates to HMRC.
  • Complete an End of Period Statement (EOPS).
  • Submit a Final Declaration each tax year.

The aim is to improve accuracy and reduce errors, but for many landlords it also means significantly more administration.

Who Will Need to Comply?

Making Tax Digital is being introduced in stages.

Currently:

  • From April 2026, individuals with qualifying income exceeding £50,000 are required to join MTD for Income Tax.
  • From April 2027, the threshold reduces to £30,000.
  • HMRC has announced plans to extend MTD to those with qualifying income above £20,000 from April 2028, subject to legislation.

Qualifying income includes:

  • Rental income from property.
  • Self-employed business income.

If you’re unsure whether the rules apply to you, it’s worth obtaining advice early rather than waiting until HMRC contacts you.

Why Many Landlords Are Concerned

Many landlords currently:

  • Keep receipts in a drawer.
  • Maintain simple spreadsheets.
  • Only prepare accounts once each year.
  • Don’t use accounting software.

Under MTD, this approach may no longer be sufficient.

Quarterly reporting means your bookkeeping needs to be kept up to date throughout the year.

While the tax payable isn’t necessarily due quarterly, your record keeping will need to be.

Common Tax Mistakes We See

Every year we see landlords paying more tax than necessary because of avoidable mistakes.

Some of the most common include:

Confusing Repairs with Improvements

Replacing a broken boiler is generally treated differently from adding an extension.

Knowing which costs are deductible against rental income can make a significant difference.

Missing Allowable Expenses

Many landlords fail to claim:

  • Letting agent fees
  • Insurance
  • Safety certificates
  • Replacement domestic items
  • Professional fees
  • Mileage for property visits
  • Advertising for tenants

Incorrect Mortgage Interest Treatment

Individual landlords are subject to different mortgage interest rules than limited companies.

Choosing the right ownership structure can have a substantial long-term impact.

Should You Own Property Through a Limited Company?

There isn’t a single answer that suits everyone.

The right structure depends on factors including:

  • Number of properties
  • Level of mortgage borrowing
  • Income tax band
  • Future plans to buy or sell
  • Inheritance planning
  • Capital Gains Tax considerations

Many investors assume incorporation automatically saves tax—it doesn’t.

Professional advice should always be obtained before transferring property into a company.

How Greystone Accountants Can Help

We specialise in supporting landlords and property investors throughout the UK.

Our services include:

  • Making Tax Digital registration and setup
  • Quarterly bookkeeping and submissions
  • Rental accounts
  • Self Assessment tax returns
  • Limited company property advice
  • Capital Gains Tax planning
  • Property portfolio reviews
  • Tax-efficient ownership advice

Whether you own one buy-to-let or an extensive property portfolio, we’ll ensure you remain compliant while helping you minimise your tax liabilities where possible.

Why Prepare Now?

Waiting until the first quarterly submission is due could leave you scrambling to organise years of records.

Preparing now means you can:

  • Choose the right accounting software.
  • Keep digital records from the outset.
  • Understand your reporting obligations.
  • Avoid last-minute stress.
  • Identify tax planning opportunities before year end.

Need Help with Making Tax Digital?

If you’re a landlord or property investor and you’re unsure how Making Tax Digital affects you, we’d be happy to help.

At Greystone Accountants, we provide straightforward, practical advice tailored to landlords across the UK.

Whether you need help setting up MTD software, preparing quarterly submissions or reviewing the tax efficiency of your property portfolio, our experienced team is here to help.

Book your free consultation today and get your property finances ready for Making Tax Digital.