From 6 April 2026, one of the biggest changes to the UK tax system in decades officially came into force. Making Tax Digital (MTD) for Income Tax is now live, fundamentally changing how landlords report their income to HMRC.
However, early industry insight suggests that a significant number of landlords across England have not yet registered or fully prepared. For landlords in Hertford, this could create serious risks if action is not taken quickly.
What has changed from April 2026
MTD replaces the traditional once-a-year Self Assessment system with a fully digital reporting process.
From 6 April 2026, landlords must comply if their total income from property and self-employment exceeds £50,000.
Instead of submitting one annual return, landlords now need to:
- Keep digital records of income and expenses
- Submit quarterly updates to HMRC
- Complete a final end-of-year declaration
This means landlords could be interacting with HMRC multiple times per year, rather than once.
Why many landlords are still not compliant
Despite the rule now being in force, many landlords have not signed up or are only partially prepared.
One key issue is awareness. HMRC may write to affected landlords, but it remains the landlord’s responsibility to check whether they need to comply and ensure they are registered.
There are also practical barriers:
- Lack of understanding around software requirements
- Delays in choosing MTD-compatible systems
- Reliance on accountants without confirming setup
- Assuming the changes do not apply yet
This has led to a situation where some landlords risk falling behind in the very first year of implementation.
The risks for Hertford landlords who do not act
For landlords in Hertford, failing to engage with MTD properly could have both financial and operational consequences.
While HMRC has confirmed there will be no penalty points for late quarterly submissions in the first year, penalties still apply for late tax returns and late payments.
Over time, a points-based penalty system will apply to missed deadlines, which could lead to fines for repeated non-compliance.
Beyond penalties, there are wider risks:
- Incorrect or incomplete records leading to tax errors
- Increased accountant costs due to rushed or reactive work
- Administrative pressure from catching up on missed submissions
- Greater HMRC scrutiny if reporting is inconsistent
For landlords managing multiple properties in Hertford and surrounding areas, these risks can escalate quickly without proper systems in place.
What this means for landlords in Hertford
This change is not just administrative, it fundamentally alters how landlords manage their finances.
For many landlords in Hertford, particularly those with growing portfolios or multiple rental properties, MTD introduces:
- More frequent financial monitoring
- Greater reliance on digital systems
- A shift towards real-time tax awareness
While this may initially feel like an added burden, it can also improve long-term financial visibility and planning.
Importantly, this is only the first phase. The income threshold will reduce to £30,000 in April 2027 and £20,000 in April 2028, meaning many more landlords in Hertford will be brought into scope.
How to check if you need to register
Landlords should urgently confirm whether they fall within the new rules.
You must use MTD if:
- You are registered for Self Assessment
- You earn income from property or self-employment
- Your total qualifying income exceeds £50,000
Even if you have not received a letter, you are still responsible for checking and complying.
How to sign up and stay compliant
To get started with MTD, landlords should take the following steps:
1. Check your eligibility
Review HMRC guidance to confirm if and when you need to comply.
2. Choose MTD-compatible software
You must use approved software to:
- Keep digital records
- Submit quarterly updates
- File your final tax return
3. Sign up with HMRC
You can register directly or through your accountant.
4. Prepare your records early
Ensure your income and expenses are being tracked digitally from the start of the tax year.
5. Speak to your accountant or agent
They can help ensure everything is set up correctly and reduce the risk of errors.
Actionable advice for Hertford landlords
To stay ahead of the changes, landlords in Hertford should:
- Review their total rental income immediately
- Confirm whether they fall within the 2026 threshold
- Begin using digital accounting systems now, even if not yet required
- Avoid leaving sign-up until deadlines approach
- Plan ahead for future threshold reductions
Early preparation is key to avoiding disruption.
Is there any good news for landlords
While MTD introduces more reporting requirements, there are some advantages.
The new system is designed to:
- Reduce errors in tax reporting
- Provide clearer visibility of tax liabilities throughout the year
- Help landlords manage cash flow more effectively
There is also a soft transition period in the first year, giving landlords time to adjust to the new system.
For organised landlords, MTD can ultimately improve financial control and long-term planning.
Final thoughts
Making Tax Digital is now a reality. For landlords in Hertford, the biggest risk is not the system itself, but failing to engage with it early enough.
Those who act now can transition smoothly and benefit from improved financial oversight. Those who delay may face increasing pressure, higher costs, and potential penalties as enforcement strengthens.
Need support navigating MTD and your property portfolio
If you are a landlord in Hertford and are unsure how these changes affect you, now is the time to get clear, practical advice.
At Hunters Stanstead Abbotts, we work closely with landlords across Hertford and East Herts to help them stay compliant, protect their investments, and plan ahead.
Your local property experts, our advice is free but our knowledge is priceless.
"I have been in and around the Hertfordshire property market for over 25 years, starting as an estate agent in the county town of Hertford and now running a successful lettings and property management company based in Stanstead Abbotts. I have let and managed property all over Hertfordshire from the area that I currently work to Wheathampstead where I owned and managed a lettings & estate agents to Watford and surrounding areas where my company acted as a marketing agent for one of the largest property management companies in the country.”
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