The way landlords report tax is changing – and it’s happening soon. Making Tax Digital (MTD) is HMRC’s plan to replace annual paper returns with a fully digital system. Instead of one big submission at the end of the year, you’ll be reporting quarterly, keeping digital records, and staying on top of compliance like never before.

This isn’t just a technical update. It’s a fundamental shift in how landlords manage their finances – and it’s coming sooner than you think.

When Will It Affect You?

MTD will roll out in stages based on income:

  • April 2026: Landlords and sole traders earning over £50,000 join first.
  • April 2027: The threshold drops to £30,000.
  • April 2028: It reduces further to £20,000.

These figures are based on gross income, not profit. If you own property jointly, only your share counts. Limited companies? They’re unaffected and will continue filing corporation tax as usual.

What Does This Mean for Landlords?

Once you’re in scope, here’s what changes:

  • Digital record-keeping becomes mandatory. Paper files and unlinked spreadsheets won’t cut it.
  • Quarterly updates replace annual returns. Four submissions per year summarising income and expenses.
  • A final declaration at year-end. This consolidates everything and replaces the current self-assessment.
  • New deadlines and penalties. Miss a deadline and you’ll earn penalty points – repeated failures mean fines.

Why It Matters

The benefits are clear: more accurate records, fewer surprises at year-end, and a clearer picture of your tax liability. But there are challenges too – learning new software, keeping records more frequently, and staying organised for quarterly deadlines.

How to Prepare Now

Start by checking your income level against the thresholds. Move to MTD-compatible software early and speak to your accountant about readiness. Build quarterly reporting into your routine now, so it becomes second nature when the rules kick in.

How Maddisons Residential Helps Landlords Stay Ahead

At Maddisons Residential, we know compliance changes can feel overwhelming. That’s why we go beyond tenant sourcing and rental returns. We partner with trusted tax specialists to keep landlords informed, prepared, and fully compliant.

As Tunbridge Wells’ award-winning property experts, we offer a boutique service rooted in the local community. From accurate valuations to full management and tailored investor advice, we combine meticulous care with proactive updates. With Maddisons Residential, you can invest confidently, knowing every detail is handled.

Ready to Prepare for Making Tax Digital?

If you’d like guidance on preparing for these changes – or simply want peace of mind that your property is in safe hands – call us today on 01892 514100 or visit https://maddisonsresidential.co.uk.