Keeping you informed of the latest changes affecting landlords.
At Howkins & Harrison, we believe that managing your property is about more than collecting rent and arranging maintenance. It also means keeping you informed of important legislative and regulatory changes that may affect you as a landlord.
Whilst our recent focus has been on the implementation of the Renters’ Rights Act, another significant change is now being introduced by HM Revenue & Customs (HMRC) – Making Tax Digital (MTD) for Income Tax.
Although this sits outside of our property management service, we wanted to make you aware of the changes early, allowing you plenty of time to understand whether they may affect you.
What is Making Tax Digital?
Making Tax Digital (MTD) for Income Tax is HMRC’s new digital tax reporting system for qualifying landlords and self-employed individuals.
Rather than submitting one annual Self Assessment tax return using traditional methods, affected landlords will be required to:
- Keep digital records of rental income and allowable expenses.
- Use HMRC-compatible software.
- Submit quarterly updates to HMRC.
- Complete an annual final declaration.
For landlords within the scheme, paper records and manual processes alone will no longer satisfy HMRC’s requirements.
Who Will Be Affected?
The scheme is being introduced in stages:
- From April 2026 – Landlords and sole traders with qualifying income over £50,000.
- From April 2027 – Threshold reduces to £30,000.
- From April 2028 – Threshold reduces to £20,000.
HMRC is contacting many affected taxpayers directly. However, landlords remain responsible for establishing whether the rules apply to them, even if they do not receive a letter.
What Should You Do?
If you believe your qualifying income may fall within one of these thresholds, we recommend speaking with your accountant or tax adviser as early as possible.
They will be able to:
- Confirm whether Making Tax Digital applies to you.
- Recommend suitable software.
- Explain the digital record-keeping requirements.
- Help you prepare well in advance of the relevant implementation date.
Looking Ahead
Whilst Making Tax Digital relates to your personal tax affairs and sits outside the scope of our property management service, we recognise that many landlords will be looking for simpler ways to comply with the new reporting requirements.
As part of our commitment to continually improving our service, we are already exploring solutions that integrate directly with our property management and payment systems.
One such platform is Nexus, which has been specifically developed for agent-managed landlords. By connecting directly with letting agent software, it brings together rental income, management fees, property expenses and property records into a Making Tax Digital-ready workflow.
This has the potential to significantly reduce the administration for landlords by removing the need to manually recreate records from rental statements every quarter, whilst providing a more streamlined route to meeting HMRC’s reporting requirements.
We are currently reviewing how solutions such as this could support our Managed and Part Managed landlords and will provide a further update once we have completed our assessment and are in a position to make recommendations.
Supporting You Beyond Property Management
As legislation, regulation and landlord responsibilities continue to evolve, we remain committed to keeping our landlords informed of significant changes that may affect them.
Whether the changes relate to tenancy legislation, compliance or wider landlord responsibilities such as Making Tax Digital, our aim is to ensure you have the information you need to stay ahead of change and make informed decisions.
Thank you for your continued trust in Howkins & Harrison. We will continue to keep you updated as further developments arise.
If you have any questions regarding the management of your property, please contact your local branch. For advice relating to your personal tax affairs, we recommend speaking with a qualified accountant or tax adviser.
