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Andrew Luxton MRICS FARLA, Senior Partner, highlights new requirements which may apply to some landlords as part of important upcoming changes. Under the government’s Making Tax Digital (MTD) initiative, these changes will affect the way property income must be reported to HM Revenue & Customs (HMRC).
From April 2026, landlords with qualifying income above the relevant threshold will be required to comply with Making Tax Digital for Income Tax Self Assessment (MTD for ITSA).
This means that instead of submitting a single annual Self Assessment tax return, landlords will be required to keep digital records of their income and expenses and submit quarterly updates to HMRC using compatible software.
Landlords with total annual business or property income above £50,000 will be required to comply from April 2026
Those with income above £30,000 will be required to comply from April 2027
Income below £30,000 is not currently scheduled to fall within the rules, although this may change in the future
Digital record keeping and quarterly submissions will replace the current once-a-year reporting process
A final declaration will still be required at the end of each tax year to confirm overall income and tax liability
There will be new penalties for late payment of tax and late submission. To ensure that you are fully compliant, we recommend that you speak with your accountant or tax adviser to ensure you have suitable software and systems in place before the changes take effect.
Our Lettings team are happy to provide further guidance on making tax digital. Find your local Stags Lettings team, here. Alternatively, visit Gov.uk for additional information.
