Free MTD Software for Landlords 2026: What’s Really Free?
Last updated 24 June 2026 · 9 min read · By the LandlordTaxAi Editorial Team
The short answer
Genuinely free MTD for Income Tax software does exist, but almost always with limits — a cap on properties or transactions, no bank feed, or a free plan that does not include the quarterly filing. HMRC offers no software of its own. For one simple property, free can be fine; for most landlords, low-cost software that imports and sorts your bank data pays for itself in saved hours and fewer mistakes.
From April 2026, landlords with qualifying income over £50,000 must keep digital records and send quarterly updates to HMRC using compatible software. Naturally, the first question everyone asks is: can I do this for free?The honest answer is “sometimes, with caveats.” Here is exactly what “free” means in practice, so you do not pick a tool that quietly fails to file your return. For the bigger picture, start with our MTD software requirements guide.
The three kinds of “free”
| Type | What it means | The catch |
|---|---|---|
| Free tier | A recognised product with a £0 entry plan | Often caps transactions/properties or excludes MTD filing |
| Bank-bundled | Bookkeeping tool included with a business account | “Free” only while you bank with them |
| Spreadsheet + bridging | Free spreadsheet, cheap/occasionally free bridging tool | Manual entry; the bridging step is what files |
The single most important check is whether the free plan actually covers MTD for Income Tax quarterly updates and the final declaration — not just basic bookkeeping. Many free plans are record-keeping only, leaving you unable to file when the deadline arrives.
How to verify any tool is the real thing
Trust the source, not the marketing. HMRC publishes “Find software that works with Making Tax Digital for Income Tax” on GOV.UK. Anything genuinely compatible appears there. If a “free MTD” product is not on that list, or only appears for a paid plan, treat the free claim with suspicion.
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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.
Spend minutes, not weekends, on MTD
LandlordTaxAi reads your bank statements, sorts every transaction into the right HMRC category, and gets you ready to file — so you are not hand-typing rows into a free spreadsheet.
See how it worksFree vs paid: the real cost
“Free” is only a saving if it does not cost you accuracy or hours. Picture two landlords with three properties each:
| Free spreadsheet — manual entry, ~3 hours per quarter | ~12 hrs/year + error risk |
| Low-cost software with bank feed and auto-categorisation | A few £/month, ~1 hr/year |
If your time is worth more than the subscription, paid wins. The landlords for whom free genuinely makes sense are those with one property, simple records, and the patience to type carefully — and even they need to confirm the free plan files, not just stores.
Frequently asked questions
Is there genuinely free MTD software for landlords?
Some HMRC-recognised products offer a free tier, and a few banks bundle bookkeeping software for their business-account customers. But 'free' almost always means limited: a cap on transactions or properties, a free entry-level plan that does not include the MTD for Income Tax quarterly filing, or a tool that is free only while you also pay for a current account. For a landlord with one simple property and tidy records, free can work. For most landlords with a mortgage, joint ownership or more than one property, the free tier runs out fast.
Does HMRC provide free MTD software itself?
No. HMRC does not provide its own software to file MTD for Income Tax quarterly updates. You must use third-party 'compatible software' from HMRC's recognised list. The old free option of typing figures straight into a Self Assessment return is exactly what MTD replaces for landlords with qualifying income over £50,000 from April 2026 — so you will need recognised software of some kind.
Can I use free spreadsheets plus bridging software?
Yes, and for cost-conscious landlords it is often the cheapest legitimate route. You keep your records in a spreadsheet (which can be free) and use low-cost or occasionally free bridging software to create the digital link and submit to HMRC. The spreadsheet itself is not MTD-compatible on its own — the bridging tool is what makes the submission. See our guide to MTD bridging software for Excel for how this works in practice.
What's the catch with free MTD software?
Common catches: the free plan does not actually include MTD for Income Tax filing (only basic bookkeeping); a hard limit on transactions, invoices or properties; no bank feed, so you type everything in by hand; no support; and 'free for the first year' pricing that jumps afterwards. Always check the recognised-software listing to confirm the free plan covers MTD for Income Tax quarterly updates and the final declaration — not just record-keeping.
Is free software worth it, or should I pay?
Do the maths on your own time. If a free tool means hours of manual data entry and a real risk of mis-categorising mortgage interest or repairs, a few pounds a month for software that imports your bank transactions and sorts them automatically usually pays for itself many times over — and reduces the chance of an HMRC correction. Free is a saving only if it does not cost you accuracy or hours.
How do I check a product is HMRC-recognised?
Use HMRC's 'Find software that works with Making Tax Digital for Income Tax' listing on GOV.UK. It is the authoritative source — anything claiming to be MTD-compatible should appear there. Filter for software that supports your situation (for example UK property income) and confirm it covers both quarterly updates and the final declaration.
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: 24 June 2026 · Based on HMRC’s “Choose the right software for Making Tax Digital for Income Tax” and “Find software” guidance, and the April 2026 £50,000 mandation threshold. Product plans and pricing change frequently — always confirm a tool is on HMRC’s recognised list and that the free plan covers quarterly filing. This article is informational only and does not constitute tax advice.