Making Tax Digital for landlords: software or accountant?

What to take away

From 6 April 2026, landlords with qualifying income above £50,000 must keep digital records in compatible software and send HMRC quarterly updates.
The threshold tests gross income, not profit, so a heavily mortgaged landlord can still be caught.
Software alone suits simple single-property cases. An accountant earns the fee where portfolios, mixed income or broken records are involved.
Confirm the current dates with HMRC before rebuilding your process, because the timetable has moved before.

Who MTD for Income Tax applies to

MTD for Income Tax Self Assessment starts on 6 April 2026 for sole traders and landlords whose qualifying income exceeds £50,000. A second group, above £30,000, joins from April 2027. HMRC publishes the timetable and the software rules through HM Revenue & Customs. The legal framework includes Finance Act 2021 and the Income Tax (Digital Requirements) Regulations 2021.

MTD start dates by income

6 April 2026
income above £50,000
April 2027
income above £30,000

Qualifying income is gross income from self-employment and property added together, measured before expenses. A landlord receiving £52,000 in rent, with £45,000 going on mortgage interest and repairs, is in scope despite a modest profit.

Most landlords currently report rental profit once a year through Self Assessment tax returns, which is the system MTD replaces for this group.

What changes for a landlord in practice

The single annual return gives way to four quarterly updates plus a final declaration. That means five submissions a year instead of one.

Keep digital records in compatible software.
Send each quarterly update to HMRC.
Complete the final declaration after the year ends.

Five submissions a year

Keep dated digital records as year runs
Send quarterly update by 7 August
Send quarterly update by 7 November
Send quarterly update by 7 February
Send quarterly update by 7 May
Send final declaration after year closes

Spreadsheets can count as digital records when bridging software sends the updates to HMRC. A spreadsheet alone does not discharge the filing duty.

Products to check include Xero, QuickBooks, FreeAgent and Sage. MTD for Income Tax availability can vary by product and date, so check the exact product and plan against HMRC's current list of compatible software before subscribing; spreadsheet users should check that their bridging software is listed too.

Where an accountant earns their fee

A single letting with one bank account and steady tenants is usually a software job. Accountants matter more when the picture is mixed.

Typical triggers include several properties held in different names, rent from residential and commercial units, furnished holiday lets, and years of unreconciled records. Each adds categorisation decisions software will not make for you.

Appointing someone goes better with a written checklist. The accounting services selection checklist covers scope, credentials, data access and fees. For credentials, check membership and standing with bodies such as ICAEW, ACCA, AAT, CIOT or ATT, using the relevant body's member directory. To authorise an accountant to deal with HMRC, use HMRC's online agent authorisation service or submit Form 64-8.

Three routes through MTD

Most landlords pick between doing it themselves, keeping an accountant on review, or handing the whole cycle over.

Who does the work

Software only: Landlord keeps records and files
Review model: Landlord records, accountant checks each quarter
Full service: Accountant records, files and reconciles

Main risk

Software only: Categorisation errors go unnoticed until a check
Review model: Responsibility splits without a written scope
Full service: Paying for capacity the portfolio does not need

Landlords with commercial units should also check whether VAT registration applies. The threshold is £90,000 of taxable turnover, and the option to tax changes the arithmetic. HMRC sets out the test on its VAT registration page.

Questions to ask before you appoint one

A short interview narrows the field faster than a fee comparison. Ask what happens each quarter, not what the annual charge is.

Which software will hold the records, and who pays for the subscription?
Who decides whether an expense is allowable, and how is that decision recorded?
What is the fee per quarterly update, and what falls outside it?
Who files the final declaration, and when will you see the figures first?
What happens if a deadline is missed, and who carries that cost?

These answers form the scope you are buying. The Self Assessment accountant fees guide shows how quotes are usually assembled, which makes the per-quarter figure easier to challenge. Ask for a written quote that separates quarterly updates, the final declaration, software subscription and extra work; compare like with like, as fees depend on the work and complexity. This article is general guidance; your own position needs a qualified adviser.

Common questions

Do I need an accountant for Making Tax Digital as a landlord?

Not automatically. One property with clean records is manageable in software. An accountant is worth the fee where income is mixed, records are behind, or you would rather not carry the deadline risk.

What counts as qualifying income for MTD?

Gross income from self-employment and property added together, measured before expenses. It is not taxable profit, which is why a landlord with a large mortgage can be inside the regime.

Can I use a spreadsheet?

Yes, if compatible software bridges the spreadsheet and sends the updates to HMRC. A spreadsheet kept on its own does not meet the digital record-keeping requirement.

What happens if a quarterly update is late?

HMRC uses a points-based system, where points accumulate across missed deadlines rather than a fine landing on the first one. Check the current thresholds rather than assuming a single late update is harmless.