HMRC will start signing up landlords and sole traders to Making Tax Digital for Income Tax from September if it believes they should already be registered, according to fresh guidance highlighted by Propertymark.
The move follows the first quarterly update deadline on 7 August and shifts the story from early adoption to enforcement. HMRC says more than 570,000 people have joined the service and more than 436,000 sole traders and landlords filed their first quarterly update, but those still outside the system may now be moved in using data from 2024-25 Self Assessment returns.
Landlords who missed the sign-up step no longer have the luxury of waiting to see what happens. HMRC is giving a soft landing on quarterly penalty points in 2026-27, but the department is clearly moving from encouragement to active compliance before stricter penalties begin next tax year.
September sign-up drive sharpens the MTD timetable
Making Tax Digital became mandatory on 6 April 2026 for landlords and sole traders with qualifying income above £50,000 in the 2024-25 tax year. HMRC says people it believes are in scope will be signed up in stages over several months from September.
Once registered, landlords should check the income sources HMRC has carried across, including UK and overseas property income, add any missing sources, choose compatible software and file any overdue updates as soon as possible.
This follows Landlord Knowledge’s earlier report on the 436,000 landlords and sole traders who met the first MTD deadline, which showed how many taxpayers had already made the shift. The new development is that HMRC is now preparing to move laggards in automatically rather than simply waiting for them to act.
Penalty points still loom from April 2027
HMRC says no penalty points will be issued for late quarterly updates during the 2026-27 tax year, but digital record-keeping rules still apply and penalties for late tax returns and payments remain in force. From 6 April 2027, the points-based system will begin for missed quarterly deadlines, with a £200 fixed penalty once four points are reached.
For landlords with mixed income streams or older record-keeping habits, that makes the next few months a clean-up period rather than a grace period. Those who sign up directly now can also check HMRC has the right details before any automatic registration notice arrives.
Landlords with broader tax changes on the horizon may also want to revisit Landlord Knowledge’s coverage of HMRC’s draft correction-notice rules, which underlined the wider direction of travel on rental-income compliance.
What this means for landlords
- If you’re over the £50,000 threshold: sign up now rather than wait for HMRC to do it for you, so you can check your details and software setup first.
- Watch for: automatic registration messages from September and the switch to penalty points from April 2027.
- Bottom line: the soft-landing year is not a free pass – HMRC is already moving toward active enforcement.
Editor’s view
The important shift here is not the headline total already in MTD. It is HMRC deciding that missing landlords should now be brought in proactively, which tells landlords the administrative phase is ending and the compliance phase is starting.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 27 August 2026
Sources: HMRC, GOV.UK guidance
Related reading: HMRC says 436,000 met first landlord MTD deadline
