Best Making Tax Digital (MTD) Software for Landlords in the UK: Free and Paid Options

This guide helps unincorporated landlords – whether you own a single buy-to-let or a substantial portfolio – choose the best Making Tax Digital software for their situation. We compare landlord-first platforms, general accounting tools, free options, and bridging solutions, with honest assessments of what each does well and where each falls short.

What is Making Tax Digital for Income Tax (MTD ITSA) for landlords?

MTD for Income Tax Self Assessment (MTD ITSA) is HMRC's programme requiring sole trader landlords to maintain digital records and report income electronically throughout the year. It is separate from MTD for VAT, which has been live since 2019 and applies only to VAT-registered businesses.

Under the new regime, landlords must use HMRC-recognised software to:

• Keep digital records of all rental income and allowable expenses
• Submit quarterly updates summarising income and expenses for each property business
• File an End of Period Statement (EOPS) confirming the accuracy of the year's figures
• Submit a Final Declaration by 31 January, replacing the traditional Self Assessment tax return

The quarterly updates are cumulative, meaning you can correct earlier figures in a subsequent submission. Importantly, this does not change when you pay tax – existing payment on account dates remain the same.

Who needs MTD software – and who is exempt?

MTD ITSA applies to individuals with gross income from property and/or self-employment above the relevant threshold. The test is based on combined gross income (before expenses), not profit. Employed income and pensions do not count.

For jointly owned property, each owner reports only their share. So if a couple owns a property 50:50 generating £60,000 in gross rent, each person's qualifying income is £30,000 – putting them in the April 2027 cohort, not the 2026 one.

Who is outside scope? Limited company landlords are not affected – they already file corporation tax returns and company accounts. Partnerships are excluded for now, with no confirmed date for inclusion. Individuals who are digitally excluded (due to age, disability, location, or certain religious grounds) can apply for an exemption.

Key MTD dates and deadlines for landlords

For the first mandated cohort (income above £50,000), the 2026–27 tax year works like this:

The standard quarterly periods run 6 April – 5 July, 6 July – 5 October, 6 October – 5 January, and 6 January – 5 April. Landlords have one month and one day after each quarter end to submit. The first quarterly update is therefore due by 7 August 2026.

Alternatively, you can elect to use calendar quarters (ending 30 June, 30 September, 31 December, 31 March), which many landlords find simpler.

After the fourth quarterly update, you file the EOPS and then the Final Declaration (covering all income, not just property) by 31 January 2028.

⚠️ Important: HMRC has confirmed a "soft landing" for the first cohort – penalty points for late quarterly updates will not apply during the 2026–27 tax year. However, this easement does not cover the Final Declaration, and it is not expected to extend to later cohorts joining in 2027 or 2028. Don't treat it as carte blanche to miss deadlines.

What MTD-compatible software must do for landlords

HMRC requires that any recognised software can:

1. Create and maintain digital records of income and expenses
2. Maintain digital links (no manual rekeying or copy-pasting between systems)
3. Submit quarterly updates to HMRC for each property business (UK and overseas are separate businesses)
4. Support EOPS and Final Declaration submissions
5. Handle multiple property businesses where relevant

Many tools also support bank feeds, receipt capture, and reporting – but these are commercial features, not HMRC requirements. The minimum bar is digital record-keeping with a compliant submission pathway.

Types of MTD software for landlords

There are broadly four routes to compliance, and the right one depends on your portfolio, your budget, and how much you enjoy (or loathe) bookkeeping.

All-in-one accounting platforms

Tools like Xero, QuickBooks, Sage, and FreeAgent are full accounting systems recognised by HMRC for MTD ITSA. They handle invoicing, expenses, bank reconciliation, and tax submissions. The downside for landlords is that none of these were designed with property in mind – you will need to configure tracking categories, set up properties manually, and possibly bolt on receipt-capture tools like Dext or HubDoc. If you already run a sole trade through one of these platforms, adding property income to the same system is a natural step.

Landlord-first property finance software

Hammock, Landlord Studio, and Landlord Vision are built specifically for landlords. They understand tenancies, per-property tracking, rent reconciliation, and landlord expense categories out of the box. The trade-off is that they may lack the depth of a full accounting suite – for example, some don't yet support the Final Declaration, requiring you to use separate tax software at year end.

Bridging software for spreadsheets

If you are firmly attached to your Excel or Google Sheets workflow, bridging software lets you keep your spreadsheet-based records and submit data to HMRC through an API connection. This is the cheapest route but requires you to maintain compliant digital links (no copy-pasting figures from one sheet to another) and to structure your spreadsheet correctly. It works best for landlords with simple portfolios and few transactions.

Combining products (a software stack)

Some landlords use a property tool like Hammock for day-to-day bookkeeping and rent tracking, then feed data into their accountant's preferred platform (often Xero) for year-end filing. This is perfectly valid under MTD rules, provided there is a digital link between the systems – typically an API integration or compliant data export. The risk is added complexity: more systems mean more things to go wrong.

How to choose the right MTD landlord software

There is no single "best" tool. The right making tax digital software for landlords depends on several factors that vary from one landlord to the next.

Portfolio size and complexity

A landlord with one buy-to-let flat and twelve transactions a quarter has radically different needs from someone managing twenty HMO rooms across four properties. Simpler portfolios can get by with free or low-cost tools; complex ones benefit from dedicated property software with per-unit tracking.

Mixed income sources

If you have both property income and self-employment income, each source requires its own quarterly update. Some platforms – notably Xero – handle multiple businesses within a single subscription. Others, like FreeAgent, currently require separate packages for landlord and sole trader income, accessed from the same login.

Joint ownership

Where a property is jointly owned, each owner must report their share. Software that supports ownership splits and apportions income and expenses automatically (Hammock does this well) saves considerable manual effort.

Limited company vs unincorporated

MTD ITSA applies only to unincorporated landlords. If your rental business sits inside a limited company, you are not affected – though you should keep an eye on the future MTD for Corporation Tax programme. If you have properties both personally and through a company, you will only need MTD software for the personal holdings.

Bank feeds and reconciliation

Good UK bank feeds are the single biggest time-saver. Auto-matching rental payments to tenancies and flagging missing rent dramatically reduces manual work. Check that your chosen tool supports your bank – not all connections are equal.

Cash basis vs accrual

Most landlords with income under £150,000 will default to the cash basis under MTD ITSA, recording income when received and expenses when paid. If your situation calls for accrual accounting (for example, because of significant prepayments or accrued income), make sure the software supports it. Most do, but some of the simpler tools default to cash only.

Accountant access

If your accountant will handle quarterly submissions, ensure the software offers agent access with review-and-approve workflows. Most established platforms do, but check that your accountant is comfortable with the tool – an accountant who knows Xero inside out may resist switching to a niche landlord product.

The best MTD software for landlords: top picks

We have selected ten tools covering landlord-first platforms, general accounting software, combined banking-and-tax solutions, and budget options. All are either HMRC-recognised for MTD ITSA or have confirmed they will be before the April 2026 deadline. Pricing was checked in early 2026 and may have changed – always verify directly with the vendor.

ANNA Money

Best for: Sole traders with rental income who want a combined business account and MTD filing service with minimal setup.

ANNA Money is an app-based business account that bundles banking, invoicing, expense tracking, and tax filing into a single platform. It has recently positioned itself aggressively for the MTD ITSA market, offering free quarterly filing on a permanent basis and a free first year of its full Self Assessment service (including the Final Declaration via its AI-powered "Auto Accountant" feature). It is HMRC-recognised and integrated with HMRC's systems for digital submissions.

Key features: Business current account, automatic transaction categorisation, receipt scanning, MTD ITSA quarterly submissions (free), Final Declaration filing, real-time tax estimates, 7-day-a-week human support.

Strengths: Quarterly MTD filings are permanently free – a genuine differentiator. The first year of the full service (including automated calculation and Final Declaration) is also free, with subsequent years at £150/year (£12.50/month on annual billing). The combined banking-plus-accounting model means transactions are captured automatically with no bank feed setup. The AI-driven automation is designed to prepare submissions with minimal manual input. Used by over 100,000 UK businesses.

Weaknesses: Property income support is listed as "coming soon" on the ANNA website – as of early 2026, the platform handles self-employment, employment, and UK dividend income, but landlord-specific features (property income categorisation, per-property tracking, ownership splits) are not yet live. This is a significant caveat for landlords. No tenancy management, no per-property P&L, and no portfolio metrics. If you use ANNA purely as a business account you will need separate property management tools.

Pricing: Quarterly MTD filings: free (permanently). Full MTD Self Assessment including Final Declaration: free for the first year, then £15/month or £12.50/month on annual billing (£150/year). Business account fees apply separately.

Alternatives to compare: FreeAgent (especially free via NatWest), Coconut, QuickFile.

⚠️ Note for landlords: ANNA Money's MTD ITSA service is strong for sole traders, but its property income module is still in development. Before signing up, confirm directly with ANNA that property income filing is live and covers your specific situation (UK property, overseas property, joint ownership). If your only qualifying income is from property, a landlord-first tool like Hammock may be a safer choice until ANNA's property features are fully available.

Hammock

Best for: Landlords of any portfolio size who want a purpose-built, plug-and-play MTD solution without accounting knowledge.

Hammock is one of the first landlord-specific platforms to be recognised by HMRC for MTD ITSA. It uses open banking to pull in transactions, automatically matches rent payments to the correct property and tenant, and maps expenses to Self Assessment categories. Ownership structures (sole, joint, HMO) are handled natively, and the accountant portal lets your adviser review and approve submissions without a separate login.

Key features: Property-level P&L, real-time rent tracking, arrears monitoring, receipt capture, portfolio metrics (LTV, yield), quarterly MTD submissions.

Strengths: Genuinely built for landlords, so setup is fast and intuitive. Strong open banking integrations. Per-property pricing means it scales affordably for HMO landlords (charged per property, not per tenancy). Accountant partnership programme may cover costs.

Weaknesses: Does not handle self-employment income – you will need a separate tool or bridging software for non-property trades. Final Declaration capability is still listed as in development – check the latest status before committing. No invoicing or purchase-order features.

Pricing: From £5.99 + VAT/month (1–3 properties on annual billing with pre-April 2026 discount); £14.99/month for 4–10 properties. Portfolio pricing available for 21+ properties. 30-day free trial.

Alternatives to compare: Landlord Studio, Landlord Vision.

Landlord Studio

Best for: Hands-on landlords who want property management features alongside MTD-compliant accounting.

Landlord Studio originated as a property management tool and has added accounting and MTD functionality. It offers rent collection, tenant screening, maintenance tracking, and financial reporting alongside digital record-keeping. It integrates with Xero, which gives accountants a familiar platform for year-end work.

Key features: Income and expense tracking per property, bank feeds (via Plaid), receipt scanning, Xero integration, portfolio reporting, tenant management.

Strengths: Combines property management with accounting in a single app. Mobile-first design is well-suited to landlords on the go. Free tier available for up to three units. Xero integration provides a clear MTD submission pathway.

Weaknesses: The direct HMRC integration for MTD ITSA is still being finalised – currently relies on the Xero integration for submissions. US-headquartered, so some features (rent collection, tenant screening) are more mature for the American market. Bank feed coverage in the UK depends on Plaid availability.

Pricing: Free (GO plan, up to 3 units, limited features); PRO from approximately $12/month (billed annually). Per-unit pricing scales upward for larger portfolios.

Alternatives to compare: Hammock, Landlord Vision.

Landlord Vision

Best for: Portfolio landlords who want comprehensive property management and accounting in one platform.

Landlord Vision is a UK-based platform covering tenancy management, compliance document tracking, accounting, and reporting. It is listed on HMRC's software page with MTD ITSA features in development, meaning quarterly submissions and Final Declaration support should arrive before the April 2026 deadline – but check the current status.

Key features: Tenancy and lease management, expense tracking, document storage, portfolio reporting, automated reminders, MTD ITSA submissions (in development).

Strengths: Deep property management features go well beyond basic accounting. UK-focused. Comprehensive reporting for larger portfolios. FCA-registered.

Weaknesses: MTD ITSA features were still listed as "in development" at time of writing – confirm the timeline before committing. Interface can feel dated compared to newer competitors.

Pricing: From approximately £1/property/month for small portfolios. Tiered pricing scales with property count.

Alternatives to compare: Hammock, Landlord Studio.

FreeAgent

Best for: Landlords who bank with NatWest, RBS, Ulster Bank, or Mettle and want a free, full-featured accounting platform.

FreeAgent is a polished cloud accounting tool with a dedicated landlord product (FreeAgent for Landlords). It is HMRC-recognised for both MTD VAT and MTD ITSA. The biggest draw is that it is available at no cost to holders of qualifying NatWest Group business accounts – making it arguably the best free MTD software for landlords who meet this criterion.

Key features: Bank feeds, expense tracking, Self Assessment filing, MTD ITSA quarterly submissions, tax timeline, receipt capture.

Strengths: Genuinely free through partner banks. Excellent UK tax integration. Clean, user-friendly interface. Good support team. Handles self-employment and property income (via separate packages accessed from one login).

Weaknesses: If you do not have a qualifying bank account, the standard price (from £9.50/month for sole traders, £5/month + VAT for the landlord-specific package) is not the cheapest option. Running both the landlord and sole-trader packages side by side can feel clunky. Lacks landlord-specific features like per-property portfolio metrics or tenancy management.

Pricing: Free with NatWest/RBS/Ulster Bank/Mettle business accounts. Otherwise from £5/month + VAT (landlord package) or £19/month (sole trader).

Alternatives to compare: QuickFile, Clear Books, Coconut.

Xero

Best for: Landlords with complex needs, limited company and personal property holdings, or accountant-led workflows.

Xero is the platform most UK accountants know best, and its new Xero Simple product (from £7/month + VAT) brings MTD ITSA support to sole traders and landlords at a lower price point than the full business plans. Uniquely among the major platforms, Xero supports multiple businesses within a single sole-trader subscription – useful for landlords with both UK and overseas property plus self-employment income.

Key features: Bank feeds, reconciliation rules, MTD ITSA submissions, multi-business support, app marketplace (1,000+ integrations), advisor access.

Strengths: Huge ecosystem – if you need an add-on, it probably exists. Multi-business MTD support in one subscription. Accountants love it. Strong reporting and audit trail.

Weaknesses: Not designed for landlords – you must configure tracking categories to separate properties, and there is no built-in tenancy management or rent reconciliation. The learning curve is steeper than landlord-first tools. Xero Simple's invoice limit (20/month) may constrain some users, though most landlords won't need many invoices.

Pricing: Xero Simple from £7/month + VAT. Standard business plans from £15/month + VAT (Starter) to £47/month + VAT (Premium).

Alternatives to compare: QuickBooks, Sage, FreeAgent.

QuickBooks Online

Best for: Landlords who want a well-known, scalable accounting platform with good mobile apps and AI-powered features.

Intuit has launched QuickBooks Sole Trader specifically for the MTD ITSA market, built on its main QuickBooks platform. It offers digital record-keeping, bank feeds, receipt capture, and quarterly submissions. The AI features (auto-categorisation, smart suggestions) can speed up routine bookkeeping.

Key features: Bank feeds, AI-powered categorisation, receipt capture via mobile, MTD ITSA submissions, mileage tracking, reporting.

Strengths: Intuitive interface. Strong mobile app. Good UK bank coverage. AI features reduce manual categorisation. Extensive integrations.

Weaknesses: Like Xero, it is not built for landlords – you will need to customise for property tracking. Some users find the transition from the old QuickBooks Self-Employed confusing. Pricing is higher than specialist landlord tools for basic needs.

Pricing: From approximately £12/month (Sole Trader) to £47/month (Premium).

Alternatives to compare: Xero, Sage, FreeAgent.

Sage Accounting

Best for: Landlords already in the Sage ecosystem, or those who want UK-based support and a straightforward setup.

Sage's new Individual tier was designed with MTD ITSA in mind from the outset, which means it avoids some of the retrofitting issues affecting competitors. It supports digital records, bank reconciliation, and quarterly submissions.

Key features: Bank feeds, MTD ITSA submissions, receipt capture (via Sage Capture app), expense categorisation, UK-based support.

Strengths: Clean, no-frills interface. Strong UK support. MTD built in from day one on the Individual plan. Familiar to anyone who has used Sage products before.

Weaknesses: Smaller integration ecosystem than Xero or QuickBooks. No landlord-specific features – you will need to adapt the general accounting framework. Limited multi-business support compared to Xero.

Pricing: From approximately £12/month (Start) to £26/month (Standard).

Alternatives to compare: Xero, QuickBooks, FreeAgent.

QuickFile

Best for: Budget-conscious landlords with straightforward portfolios who want free or near-free MTD compliance.

QuickFile is a UK-built, cloud-based accounting platform that offers a genuinely free tier for small users (under 1,000 nominal ledger entries per year). It is HMRC-recognised and supports the MTD ITSA pilot scheme. For landlords with modest transaction volumes, it can handle digital records, bank reconciliation, and quarterly submissions without any subscription cost.

Key features: Free accounting for small users, MTD ITSA submissions, Receipt Hub with OCR, bank feeds (paid add-on), customisable reports, unlimited users.

Strengths: Free for most small landlords. Surprisingly feature-rich for a free tool. UK-focused. Active user community. Receipt Hub automates data entry.

Weaknesses: Bank feeds require the paid Power User subscription (£6/month). The interface is functional rather than polished. No landlord-specific features – you are working within a general accounting framework. Limited support on the free tier.

Pricing: Free (under ~1,000 ledger entries/year). Power User: approximately £6/month (£60 + VAT/year). MTD ITSA module available at low additional cost.

Alternatives to compare: Clear Books, FreeAgent (with qualifying bank account).

Coconut

Best for: Sole traders with rental income who want app-first, mobile banking-style bookkeeping.

Coconut positions itself at the intersection of banking and accounting, targeting self-employed individuals and landlords. It offers a current account alongside bookkeeping and tax tools, making it easy to capture and categorise transactions in real time.

Strengths: Mobile-first design suits landlords who prefer an app over desktop software. Automatic categorisation from linked accounts. Simple tax estimates. MTD ITSA support.

Weaknesses: Best suited to sole traders who use Coconut as their primary business account – less effective if your rental income flows through other banks. Limited landlord-specific features. Smaller user base means fewer community resources.

Pricing: Free plan with limited features. Paid plans from approximately £5/month.

Alternatives to compare: FreeAgent, QuickFile.

Clear Books

Best for: Sole landlords and self-employed individuals who want free, no-frills MTD ITSA compliance.

Clear Books introduced a completely free MTD Income Tax plan in 2025, aimed squarely at sole traders and landlords. There is no stated revenue limit and no transaction limit on the free tier, making it one of the most accessible entry points for MTD compliance.

Key features: Digital record-keeping, MTD ITSA submissions, income and expense categorisation, desktop and mobile app, basic reporting.

Strengths: Genuinely free with no transaction cap. HMRC-recognised. Simple interface. Available on desktop and mobile. Accredited by the Institute of Certified Bookkeepers.

Weaknesses: Very basic feature set – no bank feeds, no advanced reporting, and no landlord-specific tools on the free plan. You are doing more manual work in exchange for zero cost. Paid plans unlock more features but at that point competitors offer better value.

Pricing: Free (MTD Income Tax plan). Paid plans from approximately £13.50/month + VAT.

Alternatives to compare: QuickFile, FreeAgent.

The best free MTD software for landlords

The question of "free" deserves a direct answer, because marketing claims and reality often diverge.

Truly free options include Clear Books' MTD Income Tax plan (no transaction or revenue limit) and QuickFile's free tier (up to ~1,000 ledger entries per year). Both are HMRC-recognised and capable of handling quarterly submissions for simple portfolios.

Free through banking partnerships: FreeAgent is fully free – not a limited version – for holders of NatWest, RBS, Ulster Bank, or Mettle business current accounts. If you qualify, this is probably the best free MTD software for landlords, given the breadth of features.

Spreadsheet plus bridging remains the lowest-cost route. You maintain your own records in Excel or Google Sheets and use bridging software (some of which is free or very cheap) to submit to HMRC. The catch: your spreadsheet must maintain digital links, meaning no copy-pasting figures between tabs or files. Formulas that flow data automatically are fine; manual transfer is not. This route works for disciplined landlords with simple affairs, but it offers no safety net – an error in your spreadsheet is an error in your submission.

⚠️ Watch out: Free tools are perfectly adequate for a landlord with one or two properties and straightforward income. But if you have joint ownership, mixed income, overseas property, or a larger portfolio, the manual effort and error risk of free tools may cost you more in mistakes and accountant time than a £6–10/month subscription would.

Comparing leading landlord MTD software at a glance

*ANNA's property income module is in development – confirm availability before signing up. **Landlord Studio is building direct HMRC integration; currently relies on Xero for MTD submissions in the UK. †Quarterly filings are permanently free; £12.50/month covers the full service including Final Declaration (first year free).

*Landlord Studio is building direct HMRC integration; currently relies on Xero for MTD submissions in the UK.

Step-by-step: getting MTD-ready with your chosen software

1. Confirm your position

Check your 2024–25 tax return. If your combined gross rental and self-employment income exceeded £50,000, you must be ready by 6 April 2026. HMRC will write to affected taxpayers, but do not wait for the letter.

2. Choose and set up your software

Pick a platform from the HMRC-recognised list (not just any product that claims MTD compatibility). Create your account, authorise the HMRC connection, and complete basic settings.

3. Structure your properties

Add each property with the correct address, ownership split, and tenancy details. Set up expense categories that map to HMRC's Self Assessment categories (repairs and maintenance, insurance, letting agent fees, and so on). Getting this right from the start saves significant reclassification work later.

4. Connect bank feeds and import data

Link your bank accounts and allow the software to pull in transactions. If you are starting mid-year, import earlier transactions via CSV or bank statements so your first quarterly update is complete.

5. Build good habits early

Capture receipts as you go – photograph them and tag them in the app immediately. Set up rules for recurring transactions (mortgage interest, management fees) so they are auto-categorised. Five minutes a week now prevents five hours of panic before a quarterly deadline.

6. Submit your first quarterly update

After 5 July 2026 (or 30 June if you elect calendar quarters), review the summary your software has generated. Fix any miscategorised transactions, get your accountant's approval if applicable, and submit. The deadline is 7 August 2026.

7. Year-end: EOPS and Final Declaration

After the fourth quarterly update, finalise your figures with any year-end adjustments (capital allowances, losses brought forward, private-use adjustments). Submit the EOPS, then the Final Declaration – which now replaces your old Self Assessment return – by 31 January 2028.

Can I keep using Excel or Google Sheets?

Yes, but with strict conditions. HMRC does not ban spreadsheets, but you must use bridging software to submit your quarterly updates electronically. More importantly, all data flowing from your spreadsheet to the submission must be digitally linked – meaning formulas, lookups, or API connections. Manually copying figures between cells, sheets, or files breaks the digital link and is non-compliant.

Common pitfalls include: version-control issues (which version was actually submitted?), broken formulas after editing, no audit trail for changes, and the risk of submitting outdated figures. If you value the flexibility of spreadsheets, consider pairing them with a robust bridging tool and maintaining version history rigorously.

Special landlord scenarios under MTD

UK vs foreign property: HMRC treats UK property and overseas property as separate businesses, each requiring its own quarterly updates. Your software must be able to handle both.

Furnished holiday lets vs long-term lets: Although the favourable tax treatment of furnished holiday lets was abolished from April 2025, these properties still need correct categorisation in your records. Check that your software distinguishes between property types.

Jointly owned property: Each co-owner reports their share. Software that automatically apportions income and expenses by ownership percentage (e.g. Hammock) is valuable here; otherwise you will need to calculate splits manually for every transaction.

Property plus self-employment: If you are both a landlord and self-employed (say, a freelance consultant who also lets a flat), each business requires separate quarterly updates. Your Final Declaration consolidates everything. Platforms like Xero handle this within one subscription; others may require separate packages.

Rent arrears, bad debts, and write-offs: Under the cash basis (which most landlords will use), you only report income when received – so arrears do not need complex accounting treatment. But if a tenant never pays and you write off the debt, you should record the write-off. Software with arrears tracking (Hammock, Landlord Studio) helps you keep sight of outstanding amounts.

Commonly missed expenses: Landlords frequently overlook allowable deductions such as landlord insurance, energy performance certificate costs, legal and professional fees for tenancy agreements, ground rent, service charges, and the cost of MTD software itself. Set up categories for all of these from day one.

Penalties and compliance pitfalls

HMRC is introducing a points-based penalty regime for MTD ITSA. Each missed quarterly or annual deadline earns one penalty point. Once you hit the threshold (four points for quarterly obligations), a £200 penalty is triggered – and every subsequent late submission incurs another £200. Points can be reset by maintaining a clean record over a set period.

Late payment penalties are separate: a first charge applies 30 days after the payment due date, with additional charges accruing thereafter.

The most effective penalty-avoidance strategy is simple: use software that reminds you of deadlines, keep records up to date throughout the quarter rather than in a last-minute rush, and submit early.

Budgeting for MTD software and support

For a single-property landlord, expect to spend between £0 and £10 per month on software. Portfolio landlords with ten or more properties should budget £10–25 per month, depending on the platform and features needed.

Watch for hidden costs: some tools charge extra for bank feeds, additional users, phone support, or premium reporting. QuickFile's bank feed add-on, for example, transforms it from a free tool into a paid one. Hammock's per-property pricing can add up quickly at the upper end.

If you use an accountant, expect their MTD-related fees to increase modestly – they now have four quarterly reviews instead of one annual bundle. Some accountants absorb software costs within their fee; ask before purchasing separately.

How to confirm HMRC recognition before you buy

HMRC maintains an official list of software recognised for MTD ITSA at gov.uk. This is distinct from the MTD for VAT list – do not assume that a tool approved for VAT submissions is also approved for ITSA.

Check the list for your specific product and version. Some vendors are listed as "in development" – meaning they have committed to supporting MTD ITSA but may not have all features live yet. If you are signing up in early 2026, confirm with the vendor that quarterly submission functionality is available now, not scheduled for a future release.

Alternatives to DIY software

Not every landlord wants to manage their own digital records. If that sounds like you, there are three practical alternatives.

Accountant-managed submissions: Your accountant uses their own MTD-compatible software, files quarterly on your behalf, and you provide transaction data – perhaps through a shared Hammock or Xero account. This is the most common approach for landlords who already have an accountant.

Minimal bridging setup: You continue using spreadsheets with light bookkeeping discipline, and your accountant or a bridging tool handles submissions. This keeps your costs low but still requires you to maintain compliant digital records.

Outsourced bookkeeping: You hand over everything – bank statements, receipts, invoices – to a bookkeeper who maintains your records and prepares quarterly submissions. Expect to pay £50–150 per month depending on complexity. This makes sense for busy landlords who view the time cost as greater than the financial cost.

Verdict: the best Making Tax Digital software for landlords by scenario

Best overall for landlords: Hammock – purpose-built, HMRC-recognised, and easy to use without accounting knowledge.

Best free option: FreeAgent with a qualifying NatWest Group bank account. If you do not qualify, ANNA Money offers permanently free quarterly filings (confirm property income support is live first). Clear Books' free MTD plan and QuickFile are solid alternatives for basic needs.

Best for sole traders with rental income: ANNA Money – if your self-employment income is the primary driver and property is secondary, the combined banking-plus-tax model is hard to beat on price and convenience. However, if property is your main income source, wait until ANNA's property module is fully live.

Best for larger portfolios: Landlord Vision (once MTD features go live) or Hammock for portfolios of any size. Xero is a strong choice if your accountant prefers it.

Best for mixed income (property + self-employment): Xero Simple, which uniquely handles multiple businesses in one subscription.

Best for accountant-led workflows: Xero – it is the platform most UK accountants use and trust.

Best budget option: QuickFile (free or £6/month) paired with its MTD ITSA module.

FAQs

Do I need a separate MTD submission for each property, or one per property business?

One quarterly update per property business, not per property. HMRC treats all your UK properties as a single UK property business, and all overseas properties as a separate overseas property business. So most landlords submit one UK property update per quarter.

Can my tenant portal or rent collection app integrate with my MTD software?

It depends on the specific tools. Landlord Studio and Landlord Vision include tenant management alongside accounting. If you use a standalone rent collection platform, check whether it exports data in a format your MTD software can import with a digital link.

Does MTD change how mortgage interest relief works?

No. The restriction of mortgage interest relief to a basic-rate tax credit (introduced from 2017) is unchanged by MTD. You still claim the tax reduction in the same way – MTD only changes how you report it digitally.

What happens if HMRC's systems are down on my quarterly deadline day?

HMRC has stated that allowances will be made for system outages on their end. Document the issue (screenshots, error messages) and submit as soon as the system is restored. In practice, the soft landing during 2026–27 should prevent penalties for the first cohort.

Does MTD require the cash basis, or can I choose accrual accounting?

The cash basis is the default for qualifying landlords, but you can elect to use accrual accounting if you prefer. Make the election through your software or tax return. Accrual is advisable where significant prepayments or accrued income exist.

References and further reading

• HMRC: Making Tax Digital for Income Tax – gov.uk/making-tax-digital-income-tax
• HMRC: Find software compatible with MTD for Income Tax – gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax
• ICAEW TAXguide 01/25: MTD Income Tax – icaew.com
• Hammock – usehammock.com
• Landlord Studio – landlordstudio.com
• Landlord Vision – landlordvision.co.uk
• FreeAgent – freeagent.com
• Xero – xero.com
• QuickBooks – quickbooks.intuit.com
• QuickFile – quickfile.co.uk
• ANNA Money – anna.money
• Clear Books – clearbooks.co.uk