2nd April 2026Making Tax Digital for Income Tax: Considerations for landlords

With over 2.8 million private landlords active in the UK, the transition to Making Tax Digital for Income Tax (MTD ITSA) represents a significant shift in tax compliance. While our core MTD ITSA page outlines the general requirements, in this briefing we break down landlord considerations, from joint ownership to those managing international property portfolios, that require attention

Which landlords are affected?

Individuals and members of a partnership receiving rental income are the primary groups in scope for MTD for Income Tax. Your requirement to comply depends on your total qualifying income (the combined gross turnover from both your rental properties and any self-employment).

MTD ITSA is being phased in starting 6 April 2026 for those earning over £50,000, followed by those over £30,000 in 2027, and those over £20,000 in 2028. At this stage, corporate landlords and trusts remain outside the scope of MTD ITSA.

Joint landlords

MTD ITSA is assessed on an individual basis. Therefore, each individual’s share of gross rent counts towards the MTD ITSA threshold. For example, if an equally jointly owned property generates £90,000 in income, each 50% owner would have £45,000, counting towards their individual qualifying income.

HMRC have introduced an easement allowing joint landlords to report only their share of gross income in quarterly returns, leaving the expenses (including finance costs) breakdown to the final declaration.

While joint property owners can register under a single HMRC reference, each beneficiary is responsible for maintaining their own digital records and making relevant submissions.  Therefore, you could have a scenario where multiple penalties could be issued to beneficiaries in respect of the same property.

Partners in Partnerships

Partnership members who also receive rental income (or self-employment income outside of the partnership) fall within the scope of MTD for Income Tax. However, their partnership income is reported only in the year-end submission, not within the quarterly MTD returns.

International Considerations

Non-UK resident landlords: Non-resident landlords holding UK property are subject to MTD. However, provided the residence tax pages were completed on the 2024/25 tax return (i.e. they were non-UK resident in the 2024/25 tax year and this was correctly shown on the tax return), an automatic deferral applies. Accordingly, taxpayers don’t need to comply until 6 April 2027.

Overseas property landlords: UK residents with overseas properties must maintain digital records and report under MTD for those assets. This responsibility ceases if the taxpayer becomes a non-UK resident, unless they continue to hold property within the UK.

Rental income below threshold but still within MTD

It should be noted that rental income is added to self-employment income (where applicable) and the sum of these is used to determine whether MTD applies. For instance, if your property income in 2024/25 was £45,000 and self-employment income was £25,000, your total qualifying income is therefore £70,000 which means MTD applies to both businesses from 6 April 2026.

Property part way through the tax year

If your property income started partway through the 2024/25 tax year, your gross income must be annualised (pro-rated to give you a 12-month figure) to determine whether you are obligated to comply from 6 April 2026. For example, if your gross income for 6 months in the 2024/25 tax year were £30,000, this would be annualised to £60,000 for the threshold test. HMRC places the responsibility on taxpayers to assess their own circumstances and determine when they meet these criteria.

Cessation of rental business

Cessation refers to the sale of the property or a fundamental change in circumstances; it is not simply a period without income due to a void period without tenants, or the property undergoing repairs.

• Before April 2026: If your 2024/25 or 2025/26 tax returns show the business has ceased (and you have no other businesses such as self employment), you are generally exempt from MTD. We recommend notifying HMRC in advance of 6 April 2026.
• After April 2026: If your business ceases after the MTD start date, you must remain compliant and file quarterly submissions until the date of cessation. HMRC must be notified promptly to ensure subsequent quarterly requirements are removed. Again all businesses must have ceased for MTD to no longer apply to you.

How HW Fisher can support

The transition to digital record-keeping requires careful planning ensure your reporting is accurate from day one. Whether you manage a single joint property or a complex international portfolio, our team is here to guide you through the process. Contact our team today to discuss your specific circumstances.

Read more guidance on Making Tax Digital for Income Tax Self-Assessment on our hub page.