Making Tax Digital is Live! Have you signed up?

The 6 April start date for Making Tax Digital for Income Tax (MTD)has now passed, and any landlords with a gross income of £50,000 or more from self-employment and property lettings in the 2024-2025 tax year should now be signed up.

MTD, replaces the familiar annual Self Assessment tax return with a system of digital record-keeping and quarterly reporting.

If your combined gross income from property lettings and self-employment was £50,000 or more in the 2024–25 tax year, you are already within scope. HMRC will have identified you from your most recent tax return and should have written to you before April. If you received that letter and set it aside, it's time to dig it out.

Specialist software

You need HMRC-recognised software to maintain digital records of your rental income and expenses throughout the year. You must then submit quarterly updates, with the first due by 7th August this year.

At the end of the tax year, a Final Declaration summarising your full annual position must also be submitted through your MTD software. 

To help members, we have created an MTD reporting software integrated into Portfolio, which you can access here.

Penalties

HMRC has confirmed it will not apply penalty points for late quarterly updates during the first 12 months from April this year, giving landlords time to adjust. The grace period should not be mistaken for an extension; the obligation is live, and landlords who delay signing up risk falling behind before the system beds in. 

We have produced a handy MTD Essential Guide for members to help with understanding the new tax reporting system.

Rollout continues

For landlords not yet caught by the £50,000 threshold, it is worth understanding what lies ahead. MTD for Income Tax is being rolled out progressively. From April 2027, landlords and sole traders with qualifying gross income above £30,000 in the 2025–26 tax year will be brought into scope. The threshold drops again from April 2028 to £20,000, based on 2026–27 gross income.  

Limited company landlords remain unaffected for now, as their income is subject to Corporation Tax, though a separate MTD for Corporation Tax programme is in development with no confirmed start date. 

Whether you're in the first wave or preparing for what's to come, getting to grips with digital record-keeping sooner rather than later will make the transition far smoother. 

If you haven't signed up for MTD yet, don't wait for HMRC to come knocking. 

More information

• For further advice on MTD and tax, you can visit our tax resources library here.  
• Our training academy also offers a Making Tax Digital training course. For more information click here.