Four filings and a declaration: what an MTD year actually looks like

Ask most landlords what Making Tax Digital means and they will say four returns instead of one. That is close enough to be reassuring and wrong enough to cause problems.

The quarterly updates are not four tax returns. They are running summaries of income and expenses, submitted from digital records, with the actual tax position settled once at the end. Understanding that distinction is what stops the first year being harder than it needs to be.

Here is what a full MTD year actually looks like, in order, and where the work really lands.

The shape of the year

Four quarterly updates through the year, then a Final Declaration after it ends. The updates report income and expenses for the period from your digital records. The Final Declaration is where the year is finalised, adjustments applied and the tax position confirmed.

The annual Self Assessment return, as a single event, goes away for the income covered by MTD. What replaces it is a rhythm rather than a deadline.

What a quarterly update contains

A summary of income and expenses for the quarter, by category, sent from your digital records through recognised software.

What it does not contain is the clever part of a tax return. Reliefs, allowances, adjustments and the final calculation are not applied quarterly. So a quarterly update is closer to sending a running total than to filing a return, and it does not need to be perfect in the way a return does, because the Final Declaration is where accuracy is settled.

That is genuinely reassuring for anyone dreading four annual returns’ worth of work. It is also why the updates are only manageable if the underlying records are already current.

The Final Declaration

After the tax year ends you confirm the year as a whole: adjustments, reliefs, anything not captured in the quarterly summaries, and any other income outside MTD.

This is where the work that used to happen every January still happens. The difference is that it starts from records that are already complete and categorised, rather than from a year of receipts.

For most landlords with straightforward affairs, that makes the Final Declaration lighter than the old annual return, because the reconstruction has already been done in instalments.

The habit change nobody mentions

Here is the part that actually determines whether MTD is painful.

Under Self Assessment you could let everything accumulate and deal with it once. Bank statements, agent statements, invoices, all reconciled in a long session before the January deadline. Plenty of competent landlords ran their affairs that way for years.

That approach cannot produce a quarterly update in July, because the records for April to June have to exist in July. The requirement is not really four submissions. It is that your books are never more than three months behind, which for many people is a genuine change in working habit rather than a change in software.

The landlords who find MTD easy are the ones who moved to continuous record keeping before it was compulsory, while there was no penalty attached to getting it wrong.

Recognised, not just ready

Records must be kept digitally and submitted through software HMRC recognises. Recognition is a published status, not a self description.

A spreadsheet can form part of a digital record keeping approach with bridging software, but a spreadsheet emailed to an accountant in January is not digital record keeping in the sense the rules mean.

Ask any provider directly whether they are HMRC recognised for MTD for Income Tax. Ready, compatible and prepared are all words that mean something short of recognised.

How Rentalize handles this

Rentalize records rent, expenses and documents against the property as they occur, so the quarterly figure is a report rather than an exercise in reconstruction. The categories stay consistent through the year, which is what makes the Final Declaration lighter.

That sits in landlord software, with letting agent software covering agents producing statements across many owners. Joint ownership is covered on our MTD for joint landlords page.

If you would like to see a quarterly summary produced from live records, you can book a 20 minute walkthrough.

Frequently asked questions

How many submissions does MTD require?

Four quarterly updates plus a Final Declaration after the tax year ends, replacing the single annual Self Assessment return for the income covered.

Are quarterly updates the same as tax returns?

No. They are summaries of income and expenses by category from your digital records. Reliefs, allowances and adjustments are applied at the Final Declaration rather than quarterly.

Can I still use a spreadsheet?

A spreadsheet can form part of digital record keeping when combined with bridging software that submits to HMRC. A spreadsheet reconciled once a year and emailed to an accountant does not meet the requirement.

What is the hardest part of MTD in practice?

Keeping records continuously. The obligation means your books can never be more than three months behind, which for landlords used to an annual reconciliation is a change of habit rather than of software.

Which landlords does MTD apply to?

Those above 50,000 pounds qualifying income from April 2026, above 30,000 pounds from April 2027, and above 20,000 pounds from April 2028. Qualifying income is gross self-employment and property income combined.