Making Tax Digital for Non-Resident Landlords and Expats

Yes. Making Tax Digital (MTD) for Income Tax applies to non-resident landlords with UK rental income in the same way it applies to landlords living in the UK. The regime went live on 6 April 2026, and HMRC's guidance is clear that if you are resident outside the UK, the rules apply to the UK self-employment and property income you declare through Self Assessment. Distance does not exempt you, and neither does having a letting agent handle everything on the ground.

Being taxed at source under the Non-Resident Landlord Scheme changes nothing either. The scheme, explained in our non-resident landlord tax guide, governs how tax is collected from your rent during the year. It has never replaced your Self Assessment return, and it does not replace MTD. If your gross UK rents are above the threshold, you will need digital records and quarterly updates, with any tax your agent or tenant has deducted still credited against your final bill on the year-end return, exactly as now.

The good news for the internationally mobile is timing. HMRC confirmed to the professional bodies in April 2026 that everyone who filed the SA109 residence pages with their 2024/25 return is automatically exempt until April 2027, whatever their income. Most established non-resident landlords are therefore not in the first wave even where their rents are well over £50,000. The trap is for new leavers, who must claim that deferral rather than receive it, which we cover below.

Your start date depends on your qualifying income, which HMRC tests one tax year at a time. Qualifying income is your total gross income from self-employment and property combined, before deducting any expenses (GOV.UK guidance on working it out). The timetable is:

• From 6 April 2026: qualifying income over £50,000 on your 2024/25 tax return.
• From 6 April 2027: qualifying income over £30,000 on your 2025/26 tax return.
• From 6 April 2028: qualifying income over £20,000 on your 2026/27 tax return. The government confirmed this threshold at Spring Statement 2025 and GOV.UK now lists the April 2028 start date, with legislation being put in place to confirm it.

Three points matter particularly for non-residents. First, the test is gross, not profit: a landlord with £52,000 of rent and £20,000 of costs is in scope, even though the profit is only £32,000. Second, if you are not UK resident, only income you are required to declare on a UK Self Assessment return counts, so foreign rental or trading income that sits outside the UK system does not push you over the threshold. Third, for jointly owned property only your share of the income counts, so a couple splitting £70,000 of gross rent equally are each measured at £35,000: outside the 2026 wave, inside the 2027 one.

HMRC is writing to taxpayers it believes are in scope, but the letters are a courtesy, not the trigger. The obligation arises from your income, so check your own position rather than waiting for post to reach you abroad. Our MTD checker walks through the tests, including the non-resident wrinkles, in about a minute.

If your 2024/25 tax return included the SA109 residence, remittance basis etc pages, you are automatically exempt from MTD until April 2027 and do not need to do anything. HMRC confirmed this to the professional bodies in April 2026, having concluded that its systems needed more time to handle the residence and split-year complexities that SA109 filers bring. The deferral applies to the whole group regardless of income level, and it covers most existing non-resident landlords, because non-residents normally file the SA109 every year alongside the property pages.

If you did not file an SA109 for 2024/25 but reasonably expect to file one for 2025/26 or 2026/27, typically because you are leaving the UK now, the same deferral exists but you must apply for it. Applications go to HMRC by phone or in writing through the Self Assessment general enquiries service, or through your agent. HMRC aims to respond within 28 calendar days, and you can appeal a refusal within 30 days of the date on HMRC's decision letter. Until the exemption is granted the normal rules continue to apply to you (and anyone who has already signed up should keep using MTD while they wait), so a departing landlord with over £50,000 of qualifying income should apply promptly rather than assume.

Two cautions. This is a deferral, not an escape: when it ends in April 2027 the normal thresholds take over, so an SA109 filer whose qualifying income is above £30,000 should expect to join from 6 April 2027, and HMRC has not yet published the full detail of how the residence pages will work inside MTD, so watch for further guidance during 2026/27. And the deferral changes nothing else: your 2025/26 and 2026/27 returns are still due in the normal way, as covered in our expat Self Assessment guide.

MTD replaces the single annual return with digital record-keeping, four quarterly updates and a final tax return, all through software. Each item of rental income and expense must be recorded digitally in an MTD-compatible product. HMRC publishes a list of compatible software, and the options range from full bookkeeping apps to bridging tools that connect an existing spreadsheet; many agents run the whole cycle on their clients' behalf. We do not endorse any single product, because the right choice usually depends on how your letting agent reports to you and how your records are kept today.

Quarterly updates are cumulative summaries of income and expenses, not tax calculations, and nothing is paid quarterly. The standard deadlines each year are:

• 6 April to 5 July: update due by 7 August, so 7 August 2026 is the first quarterly deadline of the new regime.
• 6 April to 5 October: update due by 7 November.
• 6 April to 5 January: update due by 7 February.
• 6 April to 5 April: update due by 7 May, just after the tax year ends.

Because each update covers the year to date rather than a single quarter, an error in one period is simply corrected in the next update. You can also elect to use calendar update periods if that fits your records better. After the fourth update you complete the tax return through your software by 31 January as now: that is where other income such as dividends, pensions or employment goes, where reliefs and the finance-cost restriction are dealt with, and where tax withheld under the Non-Resident Landlord Scheme (your NRL6 certificate) is credited. Payment dates do not change: the 31 January balancing payment and any payments on account run exactly as before.

Each missed MTD deadline earns one penalty point, and at four points HMRC charges a £200 penalty, with a further £200 for every additional miss while you remain at the threshold (GOV.UK penalties guidance). One late update is therefore survivable; a pattern is not. Points expire automatically after 24 months if you stay below the threshold, but once you reach it you must submit on time for 12 months and bring everything outstanding up to date before the slate is wiped.

There is a soft landing for year one: HMRC has confirmed there are no penalties for missing a quarterly update deadline in the 2026/27 tax year, although the updates must still be sent and the tax return deadline is still policed as normal. Late payment is penalised separately from late filing: broadly 3% of the unpaid tax at day 15, a further 3% at day 30 and an annualised 10% charge from day 31, on top of late payment interest.

For non-residents the practical risks are mundane rather than technical: time zone slips, HMRC letters going to an old UK address, and software or banking access problems from abroad. Keeping your address current with HMRC and having a UK agent authorised to file for you removes most of them.

Work out your start date first, then build the routine backwards from it. In practice that means:

• Pull your 2024/25 return and add up gross rents plus any self-employment turnover declared to HMRC. Over £50,000 points to April 2026; over £30,000 points to April 2027.
• Check whether that return included the SA109 residence pages. If it did, your start is deferred to April 2027 automatically and no action is needed yet.
• If you are leaving the UK in 2026 or 2027 and will file the SA109 for the first time, apply to HMRC for the deferral now rather than assuming you have it.
• Choose software, or an agent who provides it, and get rental income flowing into digital records well before your first quarter starts.
• If you sit near a threshold, watch rent rises: an increase in gross rents during 2025/26 can pull you into the April 2027 wave.
• Diarise the cycle: 7 August, 7 November, 7 February, 7 May, then the 31 January return.

Run your numbers through our MTD checker to confirm your start date, and use the rental income calculator to see what the tax itself looks like once expenses and the finance-cost credit are applied. If you have overseas property income too, our foreign rental income guide explains how that side is reported.

If you would rather not manage four extra deadlines from another time zone, Horizon runs the full quarterly cycle for non-resident landlords as part of our Global Compliance Manager service: digital records, all four updates, the year-end return and the Non-Resident Landlord Scheme paperwork, handled by a Chartered Tax Adviser for a fixed fee agreed before any work starts.