Landlords and agents given extra two years to get ready for tax changes
The Government says Making Tax Digital rules will not now apply until April 2026 for some and 2027 for others.
Landlords and letting agents are being given longer to prepare for HMRC’s controversial Making Tax Digital (MTD) requirements.
The Government says it understands the current economic situation is challenging for property owners and managers, and MTD is a major change.
So, now the mandatory use of the HMRC software to file income figures every three months instead of annually, will not start until April 2026 rather than April 2024.
From April 2026, landlords with an income of more than £50,000 will be required to keep digital records and provide quarterly updates on their income and expenditure to HMRC through MTD-compatible software.
Those with an income of between £30,000 and £50,000 will need to do this from April 2027. HMRC says most customers will be able to join voluntarily beforehand meaning they can eliminate common errors.
Right time
The Government has also announced a review into the needs of smaller businesses, and particularly those under the £30,000 income threshold. It will be used to consider any further roll out of MTD after April 2027.
“It is important to ensure this works for everyone”
Victoria Atkins, financial secretary to the Treasury, says: “It is right to take the time to work together to maximise the benefits of Making Tax Digital for small businesses by implementing the change gradually. It is important to ensure this works for everyone: taxpayers, tax agents, software developers, as well as HMRC.
“Smaller businesses in particular should be able to experience the benefits of increased digitalisation of income tax in a way which meets their needs. That is why we are also today announcing a review to establish the best way to achieve this.”
