The biggest overhaul of the UK tax system in a generation came into force yesterday, Monday 6 April 2026, requiring landlords with qualifying income to keep digital records and file quarterly updates with HMRC. Making Tax Digital for Income Tax will initially affect self-employed individuals and landlords with annual business or property income over £50,000. Those earning between £30,000 and £50,000 are brought into the regime from April 2027.
Treasury minister says MTD will cut £6bn tax gap
Dan Tomlinson, Exchequer Secretary to the Treasury, said: “Making Tax Digital for Income Tax is the biggest modernisation of the tax system for a generation. “Under the current system, records are completed up to 21 months after transactions take place, increasing the risk of avoidable errors. Around £6 billion is lost each year where Self Assessment business customers do not pay the correct tax. Keeping digital, up-to-date records reduces error, protecting revenue to fund vital public sector plans including reducing NHS backlogs and giving children the best start in life.” Tomlinson added that the system would help taxpayers manage their finances throughout the year, reducing the last-minute scramble to complete annual Self Assessment returns.
What landlords need to do now
Landlords within scope must use MTD-compatible software to maintain digital records of income and expenditure. They will need to submit quarterly updates to HMRC, with a final declaration replacing the current Self Assessment return. HMRC data released last month showed that just five percent of the 118,000 landlords expected to be in scope from day one had signed up to the system. The government has responded by offering first-year penalty relief for those who miss quarterly deadlines while adjusting to the new requirements. This follows Landlord Knowledge’s March report on MTD registration rates, which highlighted concerns about landlord readiness. The NRLA has since partnered with software providers to help members transition to compliant record-keeping. Free software options are available for landlords with straightforward affairs, though those with more complex portfolios may need paid solutions. The government’s MTD software finder lists approved options for landlords to compare.
What this means for landlords
- If you earn over £50,000: You must use MTD-compatible software from tomorrow – quarterly updates are now mandatory.
- Watch for: HMRC has offered first-year penalty relief, but this only applies to reasonable excuses – persistent non-compliance will still attract fines.
- Bottom line: Those not yet registered should sign up immediately and begin keeping digital records from 6 April.
Editor’s view
The writing has been on the wall for years, but many landlords have left it late. First-year penalty relief offers breathing room, but it is not a free pass. Those still using spreadsheets or paper records need to act this week – not in six months when HMRC starts sending warning letters.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 7 April 2026
Sources: HMRC, HM Treasury
Related reading: HMRC confirms 118,000 landlords face quarterly tax reporting from April
