Copy article

Making Tax Digital "will be the tipping point" for many landlords: "It will be passed on to tenants in rising rents"

ended 09. April 2026

MAKING Tax Digital "will be the tipping point" for many landlords with experts warning "it will be passed on to tenants in rising rents".

A quiet tax reform is about to redraw Britain’s rental map. Making Tax Digital won’t arrive with protests or panic – but its impact could be just as profound, steadily pushing thousands of small, often older landlords out of the market and tightening the supply of homes when the country can least afford it.

For years, owning a rental property has been a safety net for ordinary people heading into retirement. A former teacher with a flat. A couple who held onto their first home. Someone who inherited a small property and relied on the rent to supplement a modest pension. This is the real face of the private rental sector. Not corporate giants, but individuals trying to stay afloat.

Now that model is under strain.

Making Tax Digital sounds harmless enough. Keep records online. Submit updates more regularly. Stay compliant. But for many smaller landlords, especially those less comfortable with technology, it feels like a step too far. Quarterly reporting, software costs, accountant fees and the fear of getting it wrong all add up.

  • What is your reaction to Making Tax Digital?
  • Will it lead to ordinary landlords fleeing the market?
  • Is it a step too far?

Responses asap.

4 responses from the Newspage community

Copy all

Copy

Editor
Steven Greenall
Mortgage and Protection Advisor at Protect & Lend
Making Tax Digital should not be an issue for landlords. Get a process in place early, then it becomes an easy habit.
Copy

Editor
Martin Rayner
Financial Adviser at Compton Financial Services
Making Tax Digital in isolation is manageable. Most landlords could adapt to it. The issue is that it’s arriving alongside a relentless stream of new pressures.

Higher tax through the additional 2% surcharge, the Renters’ Rights Bill making it harder to regain possession or sell, costly EPC upgrades, and expensive licensing schemes in some areas — the list keeps growing. Each change on its own may be justifiable, but together they create a constant squeeze on landlords.

Whether intentional or not, the direction of travel is clear. It’s becoming harder, more complex, and more expensive to be a landlord.

Making Tax Digital won’t force an immediate exodus on its own, but it adds to that cumulative pressure and, for many, will be the tipping point.

The result is fewer landlords, less rental stock, and ultimately higher rents for tenants.
Copy

Editor
Michelle Lawson
Director at Lawson Financial
The additional costs of all of this for no reason, and when the current system isn't broken, is yet another financial burden to landlords which will just be further passed on to tenants in rising rents or result in a property sale and another person waiting for a home. Some landlords have had enough with the constant onslaught and strangulation of the sector. Accountants will be further under pressure to assist with more regular reporting and costs will also be passed on to landlords and subsequently tenants. There is no winner out of this pointless change and the cost to the tax payer for its implementation can also not be ignored. A change in isolation is fine, a complete barrage of negativity will breed disharmony.
Copy

Tony Fitzpatrick
Founder at People Matter TV
Making Tax Digital may look like a technical upgrade, but for thousands of small landlords it represents a real-world tipping point. These are not large-scale investors with systems and support teams — they are individuals, often later in life, managing one or two properties as part of their retirement planning. When you layer quarterly reporting, software requirements and rising compliance costs onto an already pressured market, the outcome becomes predictable. Some will simply decide it is no longer worth the risk or the effort. The concern is not just for those landlords themselves, but for the wider housing system. At a time when demand is rising and supply is already constrained, even a gradual exit of small providers will tighten availability and push rents higher.