Landlords had been given an extra two years to prepare for a requirement that they maintain their accounting records using a computer system able to generate digital self-assessment tax returns. And those landlords with property income of less than £30,000 may not now be required to comply at all.
HMRC’s Making Tax Digital (MTD) was due to go live for landlords with gross property income in excess of £10,000 in April 2024. From then records would need to be kept using MTD-compliant software and both annual and quarterly tax returns were to have been required.
Now the start date is to be staggered, with larger landlords being brought into MTD from April 2026.
Financial Secretary to the Treasury Victoria Atkins made the announcement in the House of Commons last week.
‘The Government understands businesses and self-employed individuals are currently facing a challenging economic environment, and that the transition to MTD for income tax self-assessment represents a significant change for taxpayers, their agents, and for HMRC’, she said.
‘The Government is therefore announcing more time to prepare, so that all businesses, self-employed individuals, and landlords within scope of MTD for income tax, but particularly those with the smallest incomes, can adapt to the new ways of working.
‘The mandation of MTD for income tax self-assessment will now be introduced from April 2026, with businesses, self-employed individuals, and landlords with income over £50,000 mandated to join first.
‘Those with income over £30,000 will be mandated from April 2027’.
And Atkins said the Government would review the needs of smaller businesses, ‘and particularly those under the £30,000 threshold’ to see ‘whether and how’ MTD can be shaped to meet their needs. Once complete consultation was promised on any further mandation of MTD.
