Buy-to-Let Tax Changes 2026: Everything Landlords Need to Know
Last updated 23 June 2026 · 12 min read · By the LandlordTaxAi Editorial Team
The short answer
In 2026, five changes matter most: Making Tax Digital becomes mandatory from April for income over £50,000; the Stamp Duty surcharge is 5%; Capital Gains Tax on residential property is 18% / 24%; the furnished holiday lettings regime has been abolished; and the Inheritance Tax bands stay frozen to 2030. Below is each one, with links to the detail.
The last two years have brought the biggest shake-up in landlord taxation in a generation, and 2026 is when the most significant change of all — Making Tax Digital — finally lands. This is your single round-up of everything that has changed and what to do about it. Think of it as the headlines; follow the links for the full guides. For the complete evergreen picture, see our complete landlord tax guide.
The changes at a glance
| Change | From | Impact |
|---|---|---|
| Making Tax Digital | Apr 2026 | Quarterly digital filing over £50k |
| Stamp Duty surcharge | Oct 2024 | 5% on additional property |
| CGT rates | Oct 2024 | 18% / 24% on residential |
| FHL abolished | Apr 2025 | Holiday lets taxed as normal |
| IHT bands frozen | to Apr 2030 | More estates dragged in |
1. Making Tax Digital arrives
The big one. From 6 April 2026, landlords with qualifying income over £50,000 must keep digital records and send quarterly updates to HMRC through compatible software, dropping to £30,000 in 2027 and a planned £20,000 in 2028. Check whether you are caught and whether you need MTD for your rental income, then how to register.
2. Stamp Duty surcharge at 5%
Buying a buy-to-let now costs a 5% surcharge on top of standard Stamp Duty — up from 3% in October 2024 — and the standard threshold dropped back to £125,000. On a £300,000 purchase that is around £20,000. See the full surcharge and refund guide.
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Rental profit & tax calculator
Estimate the tax on your rental income for 2026/27
Result
- Taxable profit (rent − expenses)
- £11,200
- Income Tax at 40%
- £4,480
- Less mortgage interest credit (20%)
- − £1,000
- Tax due on this property
- £3,480
- Income after tax
- £7,720
Estimate based on verified 2026/27 UK rates. Informational only — not personal tax advice.
Get ready for Making Tax Digital now
LandlordTaxAi keeps digital records, categorises every transaction, and prepares your quarterly updates — built for April 2026.
See how it works3. Higher Capital Gains Tax rates
Residential property gains are taxed at 18% / 24%, and the main rates for other assets were aligned to the same figures in October 2024. Reporting and payment is still due within 60 days of selling residential property. Learn how to calculate CGT and how to reduce it.
4. Furnished holiday lettings abolished
From 6 April 2025 holiday lets lost their special regime and are now taxed as ordinary property income — Section 24 applies, capital allowances are gone, and the 10% relief on sale has ended. Read the Airbnb and holiday let tax guide.
5. Inheritance Tax bands frozen
The £325,000 nil-rate band and £175,000 residence band stay frozen until April 2030. With property values rising, more landlord estates drift into the 40% net every year — and a buy-to-let portfolio gets no business relief. See the buy-to-let Inheritance Tax guide.
What to do about it
None of this means giving up. The landlords who cope best in 2026 are the ones who plan: get your records digital before April, weigh up personal versus a limited company, claim every allowable expense, and use simple steps like splitting income with a spouse. Good record-keeping is the thread that runs through all of it.
Frequently asked questions
What are the main buy-to-let tax changes for 2026?
The headline change is Making Tax Digital for Income Tax, which becomes mandatory from 6 April 2026 for landlords with qualifying income over £50,000. On top of that, the Stamp Duty surcharge on additional property is 5%, Capital Gains Tax on residential property is 18%/24%, the furnished holiday lettings regime has been abolished, and the Inheritance Tax nil-rate bands remain frozen until April 2030.
Do I have to use Making Tax Digital in 2026?
If your qualifying income from property and self-employment is over £50,000, yes — from 6 April 2026 you must keep digital records and send quarterly updates to HMRC using compatible software. The threshold falls to £30,000 from April 2027 and a planned £20,000 from April 2028. Below those levels you continue with the normal Self Assessment return for now.
Has Stamp Duty gone up for landlords?
Yes. The surcharge on additional residential property rose from 3% to 5% on 31 October 2024 and remains at 5% on top of standard rates in England and Northern Ireland for 2026. In addition, the standard nil-rate threshold reverted to £125,000 from April 2025, so most buy-to-let purchases now pay more Stamp Duty than they did a couple of years ago.
Are holiday lets still tax-advantaged?
No. The Furnished Holiday Lettings regime was abolished from 6 April 2025, so holiday and short-term lets are now taxed as ordinary property income. That means Section 24 applies to their mortgage interest, capital allowances on furniture are gone, and the 10% Business Asset Disposal Relief on sale no longer applies.
Is now a bad time to be a landlord?
The tax environment has tightened, but planning still makes a big difference. Choosing the right structure, claiming every allowable expense, splitting income with a spouse, and timing disposals can all reduce the impact of these changes. The landlords who struggle are usually the ones who do not plan for Making Tax Digital, payments on account, or Section 24 — all of which are manageable with good records.
Written and reviewed by the LandlordTaxAi Editorial Team. Our guides are reviewed against current HMRC guidance and updated when the rules change. Operated by LandlordTaxAi, United Kingdom. Follow us on LinkedIn.
Last reviewed: 23 June 2026 · Based on HMRC guidance on Making Tax Digital for Income Tax, Stamp Duty Land Tax higher rates, Capital Gains Tax rates, the abolition of furnished holiday lettings and Inheritance Tax thresholds. Figures are for the 2026/27 tax year. This article is informational only and does not constitute tax advice. Always check the latest details on GOV.UK or with a qualified accountant.