Making Tax Digital Checklist for Landlords: 10 Steps to Get Ready

Last updated: 8 October 2026 · Next review: April 2027

Making Tax Digital (MTD) for Income Tax is already live for landlords with qualifying income over £50,000, and it reaches the £30,000 group on 6 April 2027 and the £20,000 group on 6 April 2028. If you’re in either of the next two groups, the best time to prepare is well before your start date.

This checklist walks through every step in order. If you want the background first — what MTD is and why it exists — read our guide to Making Tax Digital for landlords.

Step 1: Work out your qualifying income

Add together your gross income from:

• UK property (all rent received),
• overseas property, and
• self-employment (turnover, not profit).

Don’t deduct any expenses, and don’t include salary from employment or pensions.

Examples:

Landlord B is the classic surprise: neither income alone crosses £30,000, but together they do.

Step 2: Check which tax return HMRC will use

HMRC decides from a specific earlier return, according to GOV.UK:

HMRC reviews your return each year, so you can be brought in later if your income grows.

Step 3: Check whether you’re exempt

Some people can apply for an exemption — most commonly if they are digitally excluded, meaning it isn’t reasonably practicable for them to use digital tools. If you’re exempt, you continue with a normal Self Assessment return. Exemptions generally need an application; don’t assume you’re exempt.

Step 4: Check how your property is owned

If you own property jointly, GOV.UK explains how your share of the income is assessed, including where you only receive your share after expenses. If you have overseas property, make sure any software you choose supports foreign property income as well as UK property. Getting this right now avoids picking software that can’t handle your situation.

Step 5: Choose your type of software

You’ll need software that works with MTD for Income Tax. There are two broad types, as the Low Incomes Tax Reform Group (LITRG) explains:

• All-in-one accounting or landlord software — keeps your records, can link to your bank, and submits to HMRC.
• Bridging software — connects a spreadsheet you already keep to HMRC. It can’t create records on its own.

Use HMRC’s software finder to filter products by income type (make sure “property” is covered). Compare options in our landlord software comparison and price table, or work through our 8-point checklist.

Things LITRG suggests checking:

• whether you need separate licences for property and self-employment income;
• whether it also handles VAT, if you’re VAT-registered;
• that you can export your records if you switch provider;
• accessibility features and the level of customer support;
• what a “free” version leaves out.

Step 6: Set up your digital records properly

The goal is for every item of income and every expense to be recorded digitally, in the right category, as it happens. Practical tips:

• Use a dedicated bank account for rent and property expenses. It makes bank feeds and categorisation far easier.
• Set up expense categories that match HMRC’s property categories (repairs, insurance, agent fees, finance costs and so on).
• Capture receipts digitally — many apps let you photograph them.
• Record jointly owned property in the way your software requires.

Step 7: Sign up for MTD

According to GOV.UK, to sign up you must be registered for Self Assessment and have submitted a tax return in the last two years. If you use an accountant, they can sign you up as your agent. Sign up in good time before your start date.

Step 8: Do a practice quarter

Start keeping MTD-style records at least one quarter before your mandatory start date. Enter real transactions, reconcile them with your bank statement, and produce a quarterly summary. You’ll find gaps — missing receipts, uncategorised payments — while there’s no deadline riding on it.

Step 9: Put the deadlines in your diary

Tax is still paid on the normal Self Assessment dates. A quarterly update is a summary, not a bill.

Set two reminders for each deadline: one a fortnight before (to tidy your records) and one a few days before (to submit).

Step 10: Understand the penalties

MTD uses penalty points: one point per missed deadline and a £200 penalty at four points, then £200 for each further miss. For 2026–27, HMRC isn’t giving points for late quarterly updates, but the tax return still counts. Late payment penalties and interest apply separately and increase from 2027–28. Full detail: MTD penalties.

Should you use an accountant?

MTD is designed so landlords can do it themselves with software. An accountant or bookkeeper may be worth it if you have several properties, joint or overseas property, or would rather not handle quarterly submissions. Ask any accountant for a clear quote for MTD work, as four updates a year is more work than one annual return. Their fees are generally an allowable expense.

Printable checklist

• Added up gross property + self-employment income
• Identified my MTD start date
• Checked whether I qualify for an exemption
• Checked how joint or overseas property is handled
• Chosen MTD-compatible software that supports property income
• Opened a dedicated bank account (recommended)
• Set up expense categories and receipt capture
• Signed up for MTD (or asked my accountant to)
• Completed a practice quarter
• Added all quarterly and annual deadlines to my calendar

A suggested timeline if you’re in the April 2027 group

If your 2025–26 return is likely to show qualifying income over £30,000, here’s one way to spread the work:

If you’re in the April 2028 group (over £20,000), the same plan works one year later.

Setting up your categories

Your software will ask you to put each transaction into a category. For property income, the main expense categories in the property pages of the Self Assessment return include items such as repairs and maintenance, finance costs (mortgage interest), legal and professional fees, insurance and other costs, and costs of services provided (such as utilities you pay). Mapping your records to these from day one means your quarterly updates and final return line up without rework. Remember that mortgage interest is treated differently from other expenses — relief is given as a 20% tax credit, according to GOV.UK — so keep it in its own category.

What records to keep

• Rent received from each tenant, with dates.
• Every allowable expense, with the receipt or invoice attached.
• Mortgage statements showing the interest element.
• Letting agent statements, if you use an agent, showing gross rent and fees separately.
• Deposit protection records and safety certificates (useful for your own compliance and, from December 2026, the PRS database).

LITRG reminds users to make sure records can be exported and kept even if you change software, because you’ll need them for years after each tax return.

Frequently asked questions

When should I start preparing for MTD? At least a quarter before your start date, and ideally earlier, so your first real update isn’t your first attempt.

Can I sign up voluntarily before my start date? GOV.UK allows sign-up if you meet the requirements. Check the official guidance for current voluntary sign-up rules.

Do I need a separate bank account? It isn’t a legal requirement, but it makes digital record-keeping much simpler.

What if I miss a quarterly deadline in my first year? For 2026–27, HMRC says it won’t give penalty points for late quarterly updates. Submit as soon as you can.

Sources

• GOV.UK — Find out if and when you need to use Making Tax Digital for Income Tax
• GOV.UK — Use Making Tax Digital for Income Tax
• HMRC — Quarterly updates for Making Tax Digital
• GOV.UK — Penalties for Making Tax Digital for Income Tax
• GOV.UK — Find software that works with Making Tax Digital for Income Tax
• LITRG — Choosing Making Tax Digital software

This checklist summarises official guidance and is not tax advice. Last checked: 8 October 2026.

Related guides

• Making Tax Digital Penalties Explained: Points, Fines and Late Payment Charges
• Making Tax Digital for Landlords: Does It Apply to You, and When?
• Landlord Safety Certificate Costs in 2026: Gas Safety, EICR and EPC
• The True Cost of Being a Landlord in the UK (2026)
• The Renters’ Rights Act: What It Means for Landlords in 2026

Figures are published examples, estimates and averages, not quotes. Rules change: check the linked official source before you act.

About this guide: written and edited by the LandlordCosts Team. We are not solicitors, accountants or insurance brokers; every figure is linked to its source. Read how we research costs, our editorial policy and more about us.