Do I need to use Making Tax Digital?
Whether you need to use Making Tax Digital depends on your qualifying income from property and self-employment. This article covers the basics for landlords. For the complete rules, use HMRC's eligibility checker.
Income threshold requirements
MTD becomes mandatory in phases based on your qualifying income. You'll need to use MTD if your qualifying income exceeds:
| Tax year | Threshold | MTD starts from |
|---|---|---|
| 2024/25 | £50,000 | 6 April 2026 |
| 2025/26 | £30,000 | 6 April 2027 |
| 2026/27 | £20,000 | Expected from 6 April 2028 |
If your qualifying income is £20,000 or less, you don't need to use MTD based on HMRC's current thresholds.
HMRC reviews your Self Assessment tax return each year to check your qualifying income. If you're above the threshold, they'll normally write to you before the tax year starts. However, it's your responsibility to check — you must sign up even if you don't receive a letter.
How to calculate your qualifying income
Your qualifying income is your gross income (turnover before expenses) from self-employment and property. HMRC assesses this based on the figures reported on your previous year's tax return.
For most landlords
Qualifying income includes:
- All rental income from UK properties
- Self-employment income (if you have any)
Qualifying income does not include:
- Dividends or PAYE income from properties held in limited companies
- Other PAYE employment income
- Other dividends or pension income
- Partnership income
Example: You have £25,000 gross rental income from two properties and £27,000 self-employment income. Your qualifying income = £52,000, which exceeds the £50,000 threshold for 2024/25.
Special circumstances
There are additional rules for foreign property, trusts, ceased income sources, and other specific situations. For the complete definition of qualifying income, see HMRC's detailed guidance.
What counts as property income for MTD
Property income includes all rent you receive from tenants, plus payments for:
- Use of furniture
- Additional services like cleaning, heating, or hot water
- Repairs covered by the tenant
You calculate qualifying income using your gross rental income — the total amount received before deducting any expenses like mortgage interest, repairs, or letting agent fees.
Joint ownership and income splitting
If you jointly own a property, your share of the property income counts toward your qualifying income, not the total amount.
For married couples and civil partners, income is normally split 50/50. For other joint ownership arrangements, your share is based on your ownership percentage.
Example: You and your sibling jointly own a property generating £30,000 gross rental income. You each own 50%. Your qualifying income = £15,000 (below the threshold).
For detailed guidance on joint ownership tax treatment, see Jointly owned properties.
Multiple properties
If you own multiple properties, you must add together the gross income from all of them. You can't separate properties to stay below the threshold.
Example: You have £15,000 from a rental flat in Manchester, £12,000 from a holiday cottage in Devon, and £8,000 from freelance work. Total qualifying income = £35,000, which exceeds the £30,000 threshold for 2025/26.
Exemptions
Some landlords are exempt from MTD even if their income exceeds the threshold—for example, due to age, disability, religious beliefs, or lack of internet access. HMRC won't grant an exemption simply because you're unfamiliar with software.
For the full list and how to apply, see HMRC's exemptions guidance.
Check your status
To confirm whether you need to use MTD and when you need to start, use HMRC's eligibility checker.
If your qualifying income is below the threshold, you don't need to use MTD. Continue reporting through Self Assessment as you do now.
If your income fluctuates around a threshold, keep track each year. HMRC assesses qualifying income based on your previous year's tax return, so a high-income year triggers MTD requirements for the following tax year.
Voluntary sign-up
You can sign up for MTD voluntarily even if your income is below the threshold. This lets you get familiar with digital record-keeping and use MTD-compatible software like Provestor before it becomes mandatory.
Voluntary users are subject to normal year-end filing penalties if they miss the final declaration, but won't receive penalties for late quarterly updates.
Next steps
- Understand the MTD cycle to see what's involved in quarterly reporting
- Check key deadlines for when your quarterly updates begin
- Learn about digital record-keeping requirements
- Find out about jointly owned properties if you share ownership