Making Tax Digital (MTD) for Landlords – A Practical, Calm Approach

Making Tax Digital (MTD) for Income Tax is coming.

From April 2026, landlords with gross rental income over £50,000 will be required to submit quarterly updates to HMRC. The threshold then reduces to £30,000 (April 2027) and £20,000 (April 2028).

For many landlords, the reaction has been frustration — or confusion. “Do I now need new software?” “Will I have to submit something four times a year?” “What if I only receive statements from my letting agent?”

The short answer is: yes, the system is changing. The longer answer is: it doesn’t need to be complicated.

At Sedgwick White, our approach to MTD is simple: landlords should not have to become software experts to stay compliant.

1. For Landlords Who Don’t Want to Learn New Software

Our solution is straightforward: We hold and operate the software on your behalf.

You simply provide your rental information each quarter — whether that is:

• Letting statements

• Bank summaries

• Rental schedules

• Or structured digital reports

We process the data, prepare the MTD submission, and file it. You remain compliant without needing to adopt new systems yourself.

You still receive professional tax oversight. You still receive an annual tax return. You simply don’t have to become a bookkeeper.

Of course completing quarterly returns will means additional professional fees, but this is offset by that savings you achieve by avoiding software subscriptions.

2. For Landlords Using Letting Agents (Net Figures Only)

Many landlords who use letting agents only see rent net of expenses arriving in their bank account.

Under MTD, HMRC expects digital records of gross income and expenses. If you only receive net figures, it is unclear how that will work with automation.

Again, this is where we step in.

Provided we receive regular statements from your agent, we can:

• Extract the gross rental income

• Separate management fees

• Categorise expenses correctly

• Maintain digital records

• Submit the required quarterly updates

  
  

There is no requirement for you to subscribe to software yourself, provided your data reaches us in a usable format.

This is particularly helpful for landlords who:

• Have multiple properties managed by an agent

• Do not wish to interact with accounting systems

• Prefer professional oversight

3. A Graduated Approach to Efficiency

In the early years of MTD, many solutions will rely on document processing — receiving statements and preparing submissions manually in the above cases.

However, we do not see this as the end point.

Our longer-term objective is to increase efficiency through:

• Secure upload portals

• Direct links with letting agent software so we can download data at source

• Automated data extraction

• System integration where appropriate

  
  

As these efficiencies develop, the process becomes:

• Faster

• More accurate

• Less labour-intensive

• More cost-effective

  
  

Over time, the aim is to reduce friction for landlords and agents alike — and reduce fees as automation improves.

4. MTD Is a Compliance Obligation — But It Doesn’t Have to Be a Burden

The key shift under MTD is not tax rates. It is reporting frequency and digital record-keeping.

For some landlords, DIY software will make sense where this can be linked to a property bank account. For others — particularly those who value professional oversight — a managed solution is more appropriate.

We believe there are broadly three groups of landlords:

1. DIY adopters – happy to learn and operate software themselves, go without professional oversight and to pay software subscription fees

2. Managed landlords – who want to remain compliant but not manage systems.

3. Integrated landlords – where data can flow directly from agent systems to tax software efficiently.

   
   

Our service is designed to accommodate the second and third groups — without unnecessary complexity.

5. A Measured and Professional Transition

MTD will be phased in over several years. That gives us time to refine processes, test systems, and build robust solutions.

Our goal is not simply to comply. It is to build a model that:

• Protects landlords from unnecessary stress

• Maintains professional tax oversight

• Avoids unnecessary software subscriptions

• Rewards efficiency as systems improve

• Works with letting agents to access digital data

If you are unsure how MTD will affect you, or whether you will need to change the way you manage your records, we are happy to discuss your individual position.

If you have a letting agent, why not ask them what they are doing to help you with MTD. If they are struggling for an answer, perhaps suggest they ought to look at ways to provide letting data digitally rather than as a PDF (which is electronic but not digital). Even an excel document would be a useful step forward.

If the above solutions seem like a better fit for your properyt business, we're always happy to be contacted.

Sedgwick White Limited

Chartered Tax Advisers Helping landlords navigate Making Tax Digital with clarity and confidence.