A new survey suggests the majority of landlords are not ready for Making Tax Digital (MTD), despite the changes coming into force soon. Only one in eight landlords say they understand the new rules, while almost nine in ten admit they’re worried about how the system will work in practice.
This lack of readiness is raising wider concerns for tenants too. It was found in a recent study that 97% of landlords plan to increase rents, with rising compliance and administration costs cited as a key reason.
Under MTD, landlords will need to submit digital records of rental income and expenses to HMRC every three months using approved software. Mistakes, missed deadlines, or incorrect reporting could result in penalties, professional fees, and extra costs.
Industry experts warn these additional pressures are likely to be passed on to tenants, rather than absorbed by landlords. Some even go as far to say that the complexity of the system could push some landlords out of the market altogether, reducing supply and putting further upward pressure on rents.
From 6 April 2026, landlords and sole traders earning over £50,000 a year will be required to comply with MTD for Income Tax.
