Making Tax Digital for Landlords: Your Simple Guide to Getting Prepared
Making Tax Digital for Landlords: Your Simple Guide to Getting Prepared
The world of tax is changing. HMRC’s Making Tax Digital (MTD) initiative will change how landlords manage and report their rental income.
While any change to tax rules can feel daunting, the reality is that with the right setup, the transition can be straightforward and manageable.
At The Bristol Residential Letting Co, we’ve been monitoring developments closely and reviewing the available HMRC-approved systems as they’ve emerged. Now that the options are clearer, we’re in a strong position to guide you through what this means in practice.
Making Tax Digital – At a Glance
Start date: 6th April 2026
Who it applies to: Landlords receiving over £50,000 per year in rental income or self employed income
What changes: Quarterly digital submissions to HMRC
First deadline: 6th August 2026
Key requirement: Use HMRC-compatible software
What Do You Need to Do?
If you are receiving over £50,000 per year from rental & self employed income , you will need to act now to prepare for April 2026.
You will need to:
Keep digital records of your rental income and expenses
Use HMRC-compatible software
Submit quarterly updates to HMRC
If your rental income is below this threshold, these rules won’t apply just yet — but they are expected to come into force over the next two years, so preparing early is still sensible.
It’s worth noting that the £50,000 threshold applies per individual, not per property.
For example, if a property is jointly owned, each owner is assessed based on their share of the rental income. This means many jointly owned properties may fall below the threshold initially, depending on how income is split.
What is Making Tax Digital (MTD)?
Making Tax Digital for Income Tax Self Assessment (ITSA) is a government requirement for landlords and self-employed individuals to:
Keep digital financial records
Submit updates to HMRC every quarter using approved software
The aim is to move away from a single annual tax return and towards a more regular, digital process.
Key Dates & Income Thresholds
The rollout of MTD for landlords is staggered based on your total annual income from property and/or business. It's crucial to know which deadline applies to you.
From April 6th, 2026: MTD becomes mandatory for landlords receiving over £50,000 per year
By August 6th, 2026: First quarterly submission deadline
From April 2027: Expected to extend to landlords receiving over £30,000
From April 2028: Expected to extend to those receiving over £20,000
Even if you fall below the initial threshold, it’s worth being aware of what’s coming.
Our Recommended Approach
To simplify your journey into MTD, we recommend focusing on three key areas. By putting these in place now, you’ll be fully prepared for the new digital requirements.
1. Set Up a Separate Bank Account
Keeping your property finances separate from your personal finances is essential.
A dedicated account for rental income and expenditure makes record-keeping clearer and will form the foundation of your MTD setup.
We suggest using a straightforward digital bank (such as Monzo or similar), particularly as these integrate well with specialist software.
2. Use Specialist Landlord Software
Under MTD, spreadsheets alone will no longer be sufficient — you’ll need HMRC-compatible software to keep digital records and submit your updates.
Having reviewed the available options in detail, and having met directly with providers, we are confident in recommending Hammock as the most suitable solution for our landlords.
We’ve assessed it carefully in terms of:
Ease of use
Security and reliability
Integration with bank accounts
Overall cost and value
Hammock is designed specifically for landlords. It connects directly to your bank account, automatically tracks income and expenses, and makes quarterly submissions straightforward and accurate.
In our view, it is one of the most effective and user-friendly platforms currently available — and we believe it will work particularly well for our landlords, including those with jointly owned properties.
To help you get started, Hammock offers:
A 30-day free trial, so you can explore the platform without commitment
Complimentary webinars designed specifically for landlords, guiding you through how to use the system effectively
👉 You can find out more about Hammock and get started here
3. Your Ongoing Financial Records
As a managed client of The Bristol Residential Letting Co, you already receive clear monthly and annual statements detailing your income and expenditure.
This means much of the groundwork is already in place, and the transition to MTD should be significantly more straightforward.
What If My Situation Is More Complex?
If your situation is more complex, it can still be managed effectively with the right setup.
For example, jointly owned properties, multiple properties, or mixed portfolios can all be accommodated using the right systems.
Platforms such as Hammock are designed to handle a wide range of landlord scenarios, including jointly owned properties and multiple income streams, and can help organise your records in line with MTD requirements.
Hammock can also be used alongside your accountant, allowing information to be shared more easily and helping to streamline the overall process.
However, your accountant will remain an important part of your tax position — particularly where your circumstances are more complex — and we would always recommend taking their advice where appropriate.
Frequently Asked Questions
Do I need to do anything right now?
If you are receiving over £50,000 per year from rental income and self employed income combined , you do need to start preparing now to ensure you are ready for April 2026.
Will you be submitting my tax returns for me?
No — you (or your accountant) remain responsible for your tax submissions. However, we provide clear, organised financial information to support this process.
Can I still use spreadsheets?
No — HMRC requires digital records and submissions through compatible software.
Is this going to be a lot more work?
There is some initial setup, but once in place, most landlords find the ongoing process straightforward — particularly with the right software.
How does this work if I jointly own a property?
The £50,000 threshold applies per individual, based on your share of the rental income — not the total rent for the property.
Software such as Hammock can also accommodate jointly owned properties, making it easier to manage records in line with MTD requirements.
Does this apply if I am an overseas landlord?
Yes — Making Tax Digital applies based on your UK rental income, not where you live.
Even if tax is deducted at source under the Non-Resident Landlord scheme, you are still required to report your income to HMRC. If your UK rental income exceeds £50,000, MTD is likely to apply.
If you are unsure how this affects your situation, we recommend speaking with your accountant.
We're Here to Help
Making Tax Digital is a significant change, but with the right systems in place — and the financial information we already provide as part of our management service — this should be a smooth and manageable transition.
If you have any questions or would like to talk anything through, please feel free to contact Emma Osborn at emma@bristolreslet.com
