Making Tax Digital: is this one of your last Self Assessment returns?

What is Making Tax Digital for Income Tax?

Making Tax Digital for Income Tax, or MTD for Income Tax, is the new way you'll report self-employment and property income to HMRC. Instead of one annual tax return, it has three parts.

You keep digital records of your rental income and expenses in compatible software. You send HMRC a quarterly update four times a year. Then you submit one final declaration after the tax year ends, which replaces your Self Assessment tax return.

That's the orientation. The mechanics, the software, the penalties and the quarter-by-quarter detail all live in the dedicated Making Tax Digital guide, and this chapter points you there rather than repeating it.

Are you in scope, and when?

When you start depends on your qualifying income, and the rollout happens in waves. HMRC checks the Self Assessment return you've already filed and writes to you if you're in scope, though it's your responsibility to check either way.

The £50,000 and £30,000 dates are confirmed. The £20,000 threshold from 6 April 2028 has been announced, and the government has set out plans to bring it in through legislation, so treat that date as the current plan rather than the final word.

If you're mandated from 6 April 2026, your Self Assessment return for the 2025/26 tax year, due by 31 January 2027, is your last ordinary one. From 6 April 2026 you move to quarterly updates instead.

Why qualifying income trips landlords up

This is the part that catches people out. Qualifying income is your gross rental income before you take off any expenses, not your profit. It's UK property and self-employment income only. Salary, dividends, and pension income don't count towards it.

So a landlord whose property brings in £55,000 of rent but only £15,000 of profit after a mortgage and costs is over the £50,000 threshold, not under it. The expenses don't pull you back below the line.

For jointly owned property, each owner counts their own share of the gross rent towards their own threshold. That's worth working through with a real example.

Take Sofia and Leo, who own a rental flat together as an equal 50/50 split. It brings in £64,000 of gross rent a year.

• Sofia: £32,000 (her half of the rent) plus £25,000 of self-employment income from her design work = £57,000, so she's mandated from 6 April 2026.

• Leo: £32,000 (his half of the rent), with no other qualifying income, so he's mandated from 6 April 2027.

Same flat, same split, two different start dates. Each owner is assessed on their own share plus their own other qualifying income.

What changes day to day?

Day to day, you swap one annual scramble for a steadier rhythm. You record income and expenses as you go, in digital records rather than a shoebox or a year-end spreadsheet.

Four times a year you send a quarterly update. These are cumulative, so each one always runs from 6 April to the end of that quarter, not just the latest three months. Your first update covers 6 April to 5 July, the second covers 6 April to 5 October, and so on. After the tax year ends you submit your final declaration, where you confirm the full picture and claim your reliefs, by the same 31 January deadline you already know.

What to do now

You don't need to do everything today, but three things are worth getting right before you're mandated rather than scrambling once you are.

• Check your gross rental income, plus your share if you own jointly, against the thresholds, so you know which wave you're in.

• Start keeping records the right way now, so the switch to digital records is a continuation rather than a fresh start.

• Choose a provider before you're mandated. The landlords who struggle are the ones who leave software until a deadline letter lands.

That last point is where the real choice sits. If you already have a provider handling your Self Assessment return, the move to MTD is far smoother when it's the same team carrying your records and your figures straight across.