MTD for ITSA: Key Deadlines and What Happens If You Miss Them

If you are a landlord, or you’re self-employed, then Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is going to change the way you report your income to HMRC. These new rules mean that you will no longer be required to file a single tax return once a year, but instead keep digital record which you will be required to update every quarter.

As with any major shift in the way we work, this has made a lot of people anxious. Missing deadlines could mean serious penalties for people, and a lot more stress, so we want to break it all down for you. In this blog we are going to be looking at exactly what you need to do to comply, what happens if you don’t and also some tips on how to make sure the switch goes as smoothly as possible. Let’s get into it.

What is MTD for ITSA?

Let’s start with the basics. MTD for ITSA is part of the UK government’s initiative to modernise the tax system, making it more accurate, efficient and up-to-date – this is what ‘Making Tax Digital’ is all about. An effort to reduce the tax gap. For people that usually submit a Self Assessment tax return, this is what it means you will need to do:

• Keep digital records of income and expenses.
• Use MTD-compatible software to send HMRC quarterly updates.
• Submit an End of Period Statement (EOPS) and Final Declaration after the tax year ends.
• Throughout the year, you will have a more accurate idea of your tax liability, rather than an unexpected tax bill at the end.

For landlords, this means recording rental income and allowable expenses in a digital format, and then using HMRC compatible software to submit these digital records.

Who Needs to Comply with MTD for ITSA?

MTD for ITSA will apply to anyone that meets HMRC’s thresholds – this includes money earned through self-employment, property, or both combined. The thresholds are as follows:

• From April 2026 – Anyone with qualifying income over £50,000 will need to comply.
• From April 2027 – The threshold lowers to those with qualifying income over £30,000.
• Under £30,000 – Currently exempt, though HMRC may extend MTD to this group in the future.

Note to landlords: The threshold is based on your gross income before expenses. If you also run a business, or are self employed (including sole traders), then these figures are combined. (VAT registered businesses should already be signed up to Making Tax Digital).

MTD for ITSA Key Deadlines

If you fall into one of the thresholds above, then you will no longer be required to submit tax returns at the end of each year. Instead, you’ll need to submit a summary of your income and expenses as your quarterly updates, via MTD compatible software.

For each quarterly deadline, you will have one month after the end of the period to submit your update:

There is a little bit of flexibility here, in that you can use the calendar quarters if you would prefer, but the deadlines will remain the same for everybody.

What Happens If You Miss a Deadline?

Just like in the current system, if you are late with your submission, you will run the risk of punishments. HMRC plan to introduce a new points system, whereby you are given points for each missed submission, and when you get a certain amount of points, you are given a fine. It will work something like this:

• You’ll get 1 point for each missed submission (this includes quarterly updates, your EOPS, or final declaration).
• Once you reach the penalty threshold (e.g. 4 points for quarterly submissions), you’ll receive a £200 fine.
• Points expire after a set period if you remain compliant.

In addition:

• Late payment penalties will apply if you don’t pay your tax on time.
• Interest charges can build up quickly if payments are overdue.

Example: If you’re required to submit 4 quarterly updates a year and you miss two in a row, you’ll already be halfway to a fine – even if you submit your EOPS and final declaration on time.

How Does MTD for ITSA Work in Practice?

That’s a lot of the theory covered, so let’s take a look at what this will mean for landlords in a more practical way. We’ll run through the steps you’ll need to take to make everything run as smoothly as possible.

1. Keep digital records – Record every rent payment, along with allowable expenses such as letting agent fees, repairs or insurance. Proper digital records will make everything an awful lot easier.
2. Submit quarterly updates – Send HMRC a summary of your income and expenses every 3 months via MTD-compatible software.
3. End of Period Statement (EOPS) – Once the tax year ends, confirm totals and make adjustments (e.g. for accruals or capital allowances).
4. Final Declaration – Similar to the current self-assessment, confirming all your taxable income from every source.

What counts as ‘digital records’?

In the interest of making things as simple for you as possible, it’s important to make it absolutely clear what records HM Revenue & Customs will be expecting from you – you don ‘t want any nasty surprises! Here are the digital record keeping requirements for landlords:

• Dates rent was received
• Amounts received (gross income)
• Expense types and amounts
• Totals by property (if applicable)

How to avoid missing MTD for ITSA deadlines

The simplest way is to get organised. Reading a blog with the title ‘MTD for ITSA: Key Deadlines and What Happens If You Miss Them’ is definitely a good start! If you know in advance exactly what is expected of you, and when it is expected, that will go a long way to ensuring that everything is done on time.

Our advice is to make a start now. Don’t wait until you have to keep these records in the right places, get ahead of the game, and then you can iron out any issues, and streamline your processes so it doesn’t take up too much of your time. In truth, the hoops you need to jump through for MTD should have a positive impact on how your business runs anyway – it forces you to get more organised, and keep better records. Utilise accounting software and other digital tools to help you. Go through your bank statements as they arrive, and add the relevant records to your MTD compatible software.

Why Landlord Vision Makes MTD for ITSA Easier

Landlord Vision is fully MTD-compatible and designed specifically for landlords. With it, you can:

• Record rental income and expenses digitally in real time.
• Generate accurate quarterly summaries automatically.
• Submit updates directly to HMRC without leaving the platform.
• Set automated reminders so you never miss a submission.

Get ready for MTD today – book a demo with Landlord Vision for free and make compliance simple.

FAQs: Deadlines & Penalties

If I miss one quarterly update, will I get an immediate fine?

Not straight away. You’ll get 1 penalty point per missed submission. Once you hit the threshold, you’ll receive a fine.

Do I need to comply if I have both rental and self-employment income?

Yes. HMRC adds these figures together to calculate your qualifying income.

What if my income drops below the threshold after I’ve started MTD?

You may be able to apply for an exemption, but you’ll need to keep complying until HMRC confirms the change.

What if I don’t have internet access?

For a few people, perhaps those without a reliable internet connection or access to a computer, these changes may be very daunting. Our advice is to get in touch with HMRC now to discuss your concerns.

Conclusion

Making Tax Digital for Income Tax Self Assessment will change the way landlords and self employed individuals report business profits and manage your tax records. This new digital system will undoubtedly take a little bit of time to get used to, but the good news is that there are already plenty of tools out there that can help you prepare now.

This doesn’t have to be a huge headache. By keeping electronic records now you will not only find that you are ready to comply with the new rules, but you will probably also find that your day-to-day business runs smoother – you are on top of things, and know where everything is if you need it.

Utilise MTD compatible software like Landlord Vision now, and get ahead of the game.