Making Tax Digital for landlords 

Making Tax Digital (MTD) for landlords is postponed

What is MTD for landlords?

The government has postponed the implementation of MTD for landlords until 2026. Any landlord with a turnover exceeding £50,000 will be within the new MTD regime for their first accounting period starting on or after 6 April 2026. The threshold is planned to reduce to turnover exceeding £30,000 from 6 April 2027.

From 6 April 2026 landlords will need to:

• record their income and expenses digitally.
• report their income and expenses quarterly to HMRC.

This is in addition to their current requirement to file a self-assessment tax return.

Background

From 6 April 2019, MTD was introduced for VAT for any ‘Taxable Person’ with VATable turnover above the VAT registration threshold.

It has always been the government’s intention to introduce MTD for income tax for both landlords and businesses, but this has been subject to a number of delays over recent years and had appeared to be low on their priority list of late.

However, a government announcement on 19 December 2022 has confirmed that MTD for landlords is now expected to be introduced with effect from 6 April 2026.

Actions to take

The long lead in time given by the government is welcome, as it will enable taxpayers to prepare for the upcoming changes, and we are hoping to see further guidance from HMRC regarding the implementation in the near future.

If MTD for VAT has taught us anything, it is that while there are not necessarily any demons to fear with MTD, early engagement with the process significantly helps taxpayers with the transition. Although 6 April 2026 seems a long way off we would urge landlords to consider the impact MTD will have on their affairs as soon as possible including considering how to digitise their records and bookkeeping.

Get in touch

For more information about the issues raised in this article or to discuss your individual circumstances get in touch with your usual Crowe contact.