One third of software products approved by HMRC for Making Tax Digital (MTD) are currently unable to file complete tax returns for landlords, according to an analysis of the official software list. Of the 128 products listed for handling British property income under MTD, 44 either have tax return functionality still in development or do not include it.
Research by landlord software company LetCompliance indicates that 84 products show the tax return function as ready, while 32 list it as 'in development' and 12 do not include the feature. Furthermore, only 11 of the 84 products showing readiness can handle all 16 other income types listed by HMRC, such as bank interest, dividends, and pensions.
Making Tax Digital for income tax began on 6 April 2026 for landlords and sole traders with qualifying income over £50,000. Under this system, landlords must submit four quarterly updates and a final tax return using compatible software. The first quarterly deadline passed in August, with the next due in November. The full tax return for the 2026-2027 tax year is due by 31 January 2028.
HMRC defines software marked as 'in development' as committed to building the functionality in time for the 2026-2027 tax return, suggesting these tools should be operational before the January 2028 deadline.