Not everyone in the first MTD wave earns over £50,000 from self-employment.
A significant chunk earn £50k+ combined — self-employment plus property income. If you are a freelancer who also rents out a property, you may be in scope and not realise it.
How the threshold works
MTD for Income Tax applies to anyone with combined qualifying income over £50,000. Qualifying income includes:
- Self-employment profits
- Property income (rental income, not capital gains)
So: £35,000 from freelancing + £18,000 from a rental property = £53,000 combined. In scope from April 2026.
Your 2024/25 income determines whether you are in the first wave. If you filed Self Assessment for 2024/25 and the combination of these two income sources exceeded £50k, start preparing now.
What is different for landlords vs sole traders
If you have both self-employment and property income, you will need to submit two sets of quarterly updates — one for your self-employment, one for your property.
Each income source is reported separately. This means more submissions, but also that your accounting software needs to handle property income specifically. Not all MTD-compatible software does this well.
For property income specifically:
- Landlord Studio — property-focused, MTD-compatible
- FreeAgent — handles both
- QuickBooks — handles both
The landlord-specific records
For property income, you need to record:
- Rental income received (per property)
- Allowable expenses (maintenance, letting agent fees, insurance, mortgage interest within limits)
- Capital allowances if applicable
The expenses rules for property are different from self-employment. Mortgage interest, for example, is now a basic rate tax reducer rather than a direct expense deduction (since 2020 changes).
Free readiness check
If you are a landlord-freelancer hybrid: landolio.com/tools/mtd-readiness-checker
The checker flags which income sources are in scope and what records you need for each.
Are you a freelancer who also has rental income? Have you started your MTD setup?
Top comments (0)