Making Tax Digital for Landlords

Does Making Tax Digital apply to landlords?

Yes. Making Tax Digital for Income Tax (MTD ITSA) applies to anyone who receives property rental income — including UK residential lettings, furnished holiday lets, and foreign property — where gross qualifying income exceeds the threshold.

Under MTD, the annual Self Assessment tax return is replaced by quarterly updates plus a final declaration. You keep digital records throughout the year and submit a summary of income and expenses every quarter via HMRC-compatible software — rather than filing one return long after the tax year ends.

Which landlords are in scope?

You fall within MTD for Income Tax if all three conditions apply:

1. You are registered for Self Assessment in the UK
2. You receive income from property (UK or overseas) and/or self-employment
3. Your gross qualifying income exceeds the threshold for the relevant tax year

How quarterly reporting works for landlords

The tax year (6 April – 5 April) is divided into four quarters. After each quarter you submit a summary of rental income and expenses to HMRC — not individual transaction records, just the totals per expense category.

Crucially, you submit one quarterly update per income source type. If you own six rental properties, you do not file six separate returns — all UK property income is aggregated into a single quarterly property update. A separate, additional quarterly update is required for any self-employment income.

Landlord expense categories under MTD

HMRC requires property expenses to be categorised when submitted. Regulas includes all standard landlord categories pre-mapped to HMRC's classifications:

• Rent, rates, insurance, and ground rent
• Property repairs and maintenance (revenue expenditure)
• Residential finance costs (mortgage interest — Section 24 restricted)
• Legal, management, and professional fees
• Cost of services, including wages paid to staff
• Travel and motoring costs related to property management
• Capital allowances on business equipment used in managing properties

Section 24 mortgage interest relief

Section 24 of the Finance Act 2015 restricts direct mortgage interest deductions for residential landlords. Instead of deducting interest as a business expense, you claim a 20% basic rate tax credit on your final declaration.

In practice, this means higher and additional rate taxpayers pay more tax on rental income than under the pre-2017 rules. Regulas tracks mortgage interest separately and applies Section 24 calculations automatically at year end — you do not need to manually adjust any figures.

Joint ownership and shared property

If you own property jointly, each owner counts their proportionate share of gross rental income towards their own qualifying income threshold. On a 50/50 split of a property generating £80,000 gross rent, each owner counts £40,000 towards their threshold.

Regulas supports joint ownership — enter your ownership percentage and we calculate your share automatically.

End of Period Statement and final declaration

After your fourth quarterly update, landlords must complete two further year-end steps:

1. End of Period Statement (EOPS) — confirm the annual figures for each income source are complete and correct, claim any property allowances, and finalise your Business Source Adjustable Summary (BSAS)
2. Final declaration — declare any remaining income (employment, dividends, savings) and submit the equivalent of your Self Assessment return by 31 January following the tax year end

Regulas guides you through both steps with a year-end checklist — ensuring you've claimed all allowable expenses and applied relevant reliefs before submitting.

Choosing MTD software as a landlord

You need HMRC-recognised MTD-compatible software that can submit quarterly property updates, End of Period Statements, and final declarations. Most general accounting platforms were designed for businesses; Regulas is purpose-built for landlords and sole traders specifically:

• Landlord expense categories pre-mapped to HMRC classifications
• Section 24 mortgage interest tracking and automatic calculation
• Portfolio view — all properties visible in one dashboard
• Multi-income support — combine property and self-employment in one account
• Joint ownership percentage calculator
• Live tax estimates updated in real time as you record transactions

See how Regulas compares on our MTD software comparison page.

How to get started

1. Check your qualifying income — total up gross rent received across all properties for 2024–25 and add any self-employment income
2. Register for MTD — follow our step-by-step MTD registration guide
3. Sign up to Regulas — create your account on the free tier, no credit card required
4. Connect to HMRC — authorise Regulas via HMRC's secure OAuth link
5. Add your properties — set ownership percentages and start recording income and expenses
6. Submit your first quarterly update — Regulas shows your next deadline and guides you through every step