MTD for Landlords 2026: Section 24, Quarterly Submissions, and What Changes Now

From 6 April 2026, UK landlords with gross rental income exceeding £50,000 must comply with Making Tax Digital for Income Tax. Instead of one annual Self Assessment return, you now submit four quarterly income and expense summaries to HMRC, followed by a year-end final declaration. This guide explains exactly what this means for your property business, how it interacts with the ongoing Section 24 mortgage interest restrictions, and what software you need to stay compliant.

Key context: UK landlords with rental income above £50,000 must comply with MTD from April 2026. Section 24 restricts mortgage interest relief to a 20% basic-rate tax credit — affecting higher-rate taxpayers most. VoxaMTD's free landlord dashboard calculates Section 24 automatically. See the landlord-specific features.

Who does MTD apply to in 2026?

MTD for Income Tax applies to individual landlords (not limited companies) whose combined gross income from property and self-employment exceeds:

• £50,000 from 6 April 2026
• £30,000 from April 2027
• £20,000 from April 2028

If you jointly own property, only your individual share counts. A landlord with a 50% share of a property generating £120,000 in rent has qualifying income of £60,000 — above the threshold.

Limited company landlords are not affected. MTD for Income Tax applies to individuals only.

What you must submit each quarter

Each quarterly update is a summary of your property business for that period:

• Gross rental income received during the quarter (your share if jointly owned)
• Allowable expenses paid during the quarter, including: letting agent fees, insurance premiums, repairs and maintenance (not improvements), council tax (where paid by landlord), utility bills (where paid by landlord), and mortgage interest costs (reported as a cost for quarterly purposes, even though the tax relief is handled differently via Section 24)

The 2026/27 quarterly deadlines are:

How MTD interacts with Section 24

Section 24 of the Finance Act 2015 fundamentally changed how individual landlords are taxed on mortgage interest. Since April 2020, individual landlords can no longer deduct mortgage interest directly from rental income. Instead, you receive a 20% tax credit on finance costs.

This remains unchanged under MTD. Section 24 restrictions continue in full from 2026.

What changes is the reporting mechanism: under MTD, you report mortgage interest as an expense in your quarterly updates (as a cost), but the 20% tax credit is applied during the final declaration calculation — not quarterly. This means your quarterly updates may show a higher gross profit figure than your actual taxable profit after the Section 24 credit is applied.

For higher-rate taxpayers, Section 24 continues to have a significant impact. If you pay 40% income tax on rental profits, the effective rate of mortgage interest relief is only 20% — meaning you pay tax on income you haven't actually received if your interest costs are high relative to rental income.

Multiple properties: what you need to report

All UK property income is reported as a single quarterly submission, regardless of how many properties you own. You do not need to submit separate quarterly updates per property.

However, you should maintain property-by-property records — HMRC may request detailed breakdowns during compliance checks. VoxaMTD's landlord dashboard lets you track income and expenses by property while combining them into a single quarterly submission.

Overseas property income is reported separately, with a single submission covering all overseas properties combined.

Capital allowances and property improvements

Under MTD, capital allowances remain claimable on commercial properties and furnished holiday lettings. For residential properties, the distinction between allowable repairs (fully deductible) and capital improvements (not deductible as revenue expenses) remains critical.

A like-for-like replacement (replacing a broken boiler with a comparable boiler) is a repair — fully deductible. Upgrading to a more modern, significantly improved boiler may be treated as a capital improvement and not deductible against rental income.

VoxaMTD's landlord dashboard tracks capital allowances separately from revenue expenses, ensuring your quarterly submissions reflect the correct categorisation.

Penalties and the grace period

HMRC has confirmed that landlords joining MTD in April 2026 will not receive penalty points for late quarterly updates during the 2026/27 tax year. This is a one-year transitional grace period.

From 2027/28, the points-based penalty system applies in full:

• 1 penalty point per missed quarterly submission
• 4 penalty points triggers a £200 fine
• Further charges accumulate for continued non-compliance

What software do landlords need?

You need HMRC-recognised software capable of keeping digital records and submitting quarterly updates. The main options for landlords:

Key steps for landlords before 7 August 2026

1. Confirm your threshold — Review your 2024/25 gross rental income (before all expenses). If it exceeds £50,000, you must comply from April 2026.
2. Sign up for MTD — Register with HMRC for MTD Income Tax Self Assessment.
3. Choose software — Select HMRC-recognised software and connect it to your bank account.
4. Start digital record-keeping — Track all rental income and property expenses from 6 April 2026.
5. Submit your first quarterly update — Due 7 August 2026 for the period 6 April to 5 July 2026.

Frequently asked questions for landlords