Many of our readers will already be aware that making tax digital (MTD) is on the horizon.
The changes to making tax digital will eventually apply to all self-employed individuals and those receiving property income. Gone are the days of fretting over a calculator surrounded by scraps of paper at the eleventh hour!
As all quarterly income submissions, including a final declaration, will be made via software under MTD, if you’re not already doing this, now is the time to plan to switch to digital software.
This blog will discuss the upcoming changes in April 2026 and how they will affect those who receive property income.
What is the current process for completing an annual self-assessment tax return?
If you’re self-employed, a freelancer, a landlord or a sole trader, you will currently complete a self-assessment tax return each year.
To record UK property income you will need to file an SA105 (property income record) alongside your SA100 (main self-assessment tax return).
HMRC’s ‘How to fill in your tax return income‘ can help you figure out which information goes where.
What is the income tax threshold for rental income?
MTD for income tax rules will apply to landlords whose combined property and/or business income (not profit) is £50,000 or more a year.
If this applies to you, then MTD for income tax will apply to you from April 2026.
Landlords with a combined property and/or business income of £30,000 or more per year will have to follow the rules from April 2027.
What is changing?
Quarterly submissions of income and expenses (along with a final declaration) will need to be made to HMRC via digital software rather than the current annual submission on a self-assessment tax return.
The quarterly deadlines will be:
- 5th August
- 5th November
- 5th February
- 5th May
You will also need to find software that works with making tax digital for income tax. Use this page to find out which software works with MTD.
Will I need to pay income tax quarterly?
There are currently no plans to change the payment dates from 31 January and 31 July each year but we wouldn’t be surprised if this were to change towards the end of the decade.
How 360 can help
We have a team of experienced and tax-qualified staff who work with a rapidly growing number of landlord clients. Landlords approach us seeking help with more than just income tax returns. Our comprehensive approach to business helps landlords with their current and future portfolio strategies. We can also help with choosing accounting software and bookkeeping.
Call us on 01482 427360 or email help@360accountants.co.uk and we’ll be happy to arrange a free of charge initial consultation. If you are in any doubt as to what to do, seek our advice – we look forward to hearing from you!
