MTD Digital Links for Landlords: Spreadsheet, Bank Feed and Bridging Rules 2026/27

What are MTD digital links for landlords?

In plain English, an MTD digital link is the electronic connection between the place you keep your rental records and the software that sends figures to HMRC. For MTD for Income Tax, HMRC’s core requirement is that you use software that works with MTD to create, store and correct digital records, send quarterly updates, and submit your tax return.

That software can be one product, such as landlord tax software, or a combination of tools. For example, a spreadsheet can hold your records and bridging software can connect those records to HMRC. What no longer fits the MTD model is keeping paper notes all year and typing rough totals into HMRC at the end.

The important point is not the label. It is the audit trail. If you can show how a rent receipt or expense moved from the source record into the quarterly totals, with corrections recorded properly, you are much closer to MTD-ready bookkeeping.

• Digital record: the rent or expense entry stored in compatible software, spreadsheet software, or another connected digital tool.
• Digital link: the electronic path from those records into MTD-compatible software.
• Quarterly update: a summary of income and expense categories sent every 3 months; HMRC says these are not tax returns.
• Tax return: the year-end submission made through compatible software, due by 31 January after the tax year.

Who needs digital links in 2026/27?

You need MTD-ready digital records and software if you are an individual landlord registered for Self Assessment, you receive property income or self-employment income, and your qualifying income is above the relevant threshold.

For property income, the key figure is gross rental income before expenses. If a letting agent deducts fees before paying you, you still look at the rent before the agent’s deduction when testing the MTD threshold.

MTD for Income Tax is being phased in. The first landlord cohort is already within the rules for the 2026/27 tax year.

Can landlords still use spreadsheets under MTD?

Yes. HMRC’s software guidance says some software connects to existing records held in spreadsheets or other accounting tools, and this is often called bridging software. That means a spreadsheet can remain part of your system if it is connected to MTD-compatible software for submissions.

The risky version is a spreadsheet that is really just a year-end calculator. If you type totals into it from bank statements in January, with no transaction-level rental record, weak categories and no clear correction history, you may struggle to show that your digital records were kept properly.

A better spreadsheet setup has one row per rent receipt or expense, dates, descriptions, categories, property names, VAT-inclusive amounts where relevant, mortgage finance costs separated, and a locked quarterly summary tab that the bridging tool can read.

Bank feeds, letting agents and the gross-rent trap

Bank feeds are useful digital links, but they are not a complete MTD system on their own. A bank feed imports what reached your bank account; it may not show gross rent, deducted letting-agent fees, retained deposits, service-charge income, or expenses paid personally rather than from the rental account.

The common landlord mistake is recording the net amount received from the agent as rent. If the tenant paid £1,200, the agent deducted £120, and you received £1,080, your records normally need to show £1,200 income and £120 letting-agent expense.

For more on choosing tools around imported transactions, see MTD bank feeds for landlords. If your bank feed is the starting point, check that your software lets you add missing rent, split agent deductions, attach statements and categorise costs correctly.

• Use a separate rental bank account where possible.
• Upload or store monthly letting-agent statements.
• Record rent gross before agent deductions.
• Keep mortgage interest or finance costs separate from ordinary repairs and running costs.
• Reconcile bank feed imports against tenancy records and agent statements each quarter.

Bridging software: when it works and when it does not

Bridging software is designed for landlords who want to keep records in spreadsheets or another existing tool but need a compliant way to send MTD updates to HMRC. HMRC’s guidance recognises software that connects to existing records, including spreadsheets, as a type of MTD software.

Good bridging software should let you connect the right spreadsheet cells, authorise the software with HMRC, send quarterly updates, and later submit the tax return through compatible software. HMRC says software authorisation must be repeated every 18 months.

The weak point is often the spreadsheet, not the bridge. If the bridge submits a total that came from copied, overwritten or poorly categorised records, the submission route may be digital but your record-keeping may still be poor.

Special rules for joint landlords and smaller property businesses

HMRC’s digital record-keeping direction includes easements for some jointly let property. For jointly let property income, an eligible person can create a single digital record for each category of their share of property income for a quarterly update period, and a single digital record for each category of their share of property expenses for the tax year.

There is also a simplified categorisation easement where annual turnover from a source is below the VAT registration threshold. The VAT registration threshold is £90,000. Where this easement applies, records can be categorised as income or expense instead of using more detailed categories, but residential property finance costs such as mortgage interest must still be recorded and submitted separately.

These easements do not remove the need for digital records, supporting documents or compatible software. They simply reduce the level of category detail for certain landlords.

• Joint ownership does not mean one co-owner’s software automatically covers everyone.
• Each landlord should understand how their share is recorded and reported.
• Mortgage interest and other residential finance costs need separate treatment.
• Keep evidence for apportionment between co-owners.
• Check your setup early if you own property with a spouse, civil partner, sibling or business partner.

Digital link checklist before your first quarterly update

Before you send your first MTD quarterly update, check the full chain from source document to HMRC submission. HMRC says you must authorise your compatible software, check your accounting period, and you cannot change your accounting period after you have sent a quarterly update.

Your software will normally default to a tax-year basis of 6 April to 5 April. If your records are kept on calendar-style periods, such as 1 April to 31 March, check HMRC’s calendar period option in your software before the first submission.

The practical test is simple: can you click from a quarterly rent or expense total back to the transactions that created it, and from those transactions back to bank records, invoices or agent statements?

• Confirm whether you are in MTD from 6 April 2026, 6 April 2027 or 6 April 2028.
• Choose software before signing up.
• Authorise the software with HMRC using your Government Gateway details.
• Check whether your software supports UK property, foreign property, self-employment, or all income sources you need.
• Map spreadsheet categories to MTD property categories.
• Run one dry quarter before your first live submission.

A worked example

Maya owns two rental properties. Her letting agent deducts fees before paying her, and she uses a spreadsheet plus bridging software.

Maya’s qualifying property income is £54,000, not £48,600, so if this was her 2024/25 figure she is in MTD from 6 April 2026. Her spreadsheet should record gross rent as income, agent fees as an expense, and mortgage interest as a separate finance-cost category before the bridging software submits quarterly totals.

Frequently asked questions