UK Government defends Making Tax Digital for landlords

The UK government is defending the Making Tax Digital (MTD) for Income Tax initiative, which became compulsory in April 2026 for landlords and sole traders with qualifying income exceeding £50,000. Exchequer Secretary to the Treasury Dan Tomlinson stated that the system helps businesses stay on top of tax affairs and reduces errors through digital tools.

HMRC reports that over 570,000 customers have joined the service, with more than 436,000 having submitted their first quarterly updates. The tax authority has begun a staged process of automatic registration for individuals who should already be using the system.

The income threshold is set to decrease in April 2027, falling to £30,000, which will bring more property owners and self-employed individuals into the regime. Under the current rules, landlords must provide quarterly updates summarizing rental income and allowable expenses, with the first major deadline for the 2026/27 tax year falling on 7 August 2026.