Specialist Landlord Accountants: Rental Income Tax, Section 24 & Making Tax Digital

Single Buy-to-Let Landlords

Individual landlords with one or two properties are often surprised at how much their tax position has changed in recent years. Section 24 means that mortgage interest is no longer an allowable deduction from rental profit; instead, a 20 per cent basic-rate credit is applied after the tax bill has been calculated on gross rental income. For a higher-rate taxpayer paying mortgage interest on a leveraged buy-to-let, this distinction is the difference between a reasonable tax bill and one that materially erodes real profit. We prepare your annual landlord tax return correctly, apply every allowable expense, manage your Section 24 position, and ensure your Self-assessment is accurate and filed on time.

Portfolio Landlords

Portfolio landlords managing five or more properties face the full complexity of rental income taxation at scale; multiple income streams, multiple expense categories, multiple mortgage finance costs to process through Section 24, and the risk that an incorrect approach to any one property compounds across the entire portfolio. Many portfolio landlords are currently paying far more tax than they legally need to because their current accountant is not managing the Section 24 interaction correctly, missing allowable expenses, or failing to plan around the April 2027 rate changes that will apply to rental income specifically.

We provide a complete rental property accountant service for portfolio landlords: preparing consolidated rental accounts across all properties, managing Section 24 finance cost credits correctly, reviewing the portfolio structure for tax efficiency, advising on the SPV limited company decision, and planning around both the current rules and the changes arriving in April 2027.

Limited Company Landlords: SPV Structure

Operating a residential property portfolio through a Special Purpose Vehicle limited company remains the most effective way for leveraged landlords to eliminate the Section 24 impact because limited companies deduct mortgage interest as a fully allowable business expense against Corporation Tax, rather than receiving only a 20 per cent basic-rate credit. However, incorporation does not mean simplicity. SPV limited company accounting requires annual statutory accounts, Corporation Tax filing, director payroll, Companies House compliance, and the personal Self-assessment return for each director; all of which must be prepared from correctly recorded rental income and expense data across every property the company holds.

As specialist accountants for limited company landlords, we provide a complete SPV accounting service; book-keeping, annual accounts, Corporation Tax, director payroll, Companies House filings, dividend planning, and director Self-assessment, alongside ongoing advice on the tax-efficient structure of your limited company portfolio and the most effective strategy for extracting profit.

Landlords Considering Incorporation

The decision to incorporate an existing personally-held property portfolio into a limited company is one of the most significant financial decisions a landlord can make and one where incorrect or incomplete advice can be extremely costly. Incorporation can trigger Capital Gains Tax on the transfer of properties from personal to company ownership, and Stamp Duty Land Tax applies to the company acquisition at the 5 per cent surcharge rate in addition to standard rates. In some cases, the combination of CGT, SDLT, and incorporation costs outweighs the Section 24 saving for years.

We model the complete financial position of incorporation for landlords considering this move; calculating the Section 24 tax saving in the company versus the personal position, the CGT and SDLT costs of transfer, the financing implications, and the year-by-year cashflow comparison under each structure. We will give you a clear, evidence-based recommendation rather than a generic suggestion to incorporate.

Holiday Let Landlords

Holiday let owners have experienced the most significant change in their tax position since April 2025, when the Furnished Holiday Lettings regime was abolished. Prior to April 2025, qualifying FHLs were treated as a business for tax purposes; mortgage interest was fully deductible, capital allowances were available on furniture and equipment, and BADR applied on disposal. From April 2025, holiday lets are treated identically to standard residential lets; Section 24 applies, capital allowances on new spending are no longer available, and CGT on disposal no longer qualifies for BADR. For FHL owners who have not reviewed their position since the abolition, the tax consequences of their current situation may not yet be fully understood.

We advise holiday let owners on the implications of the FHL abolition, review whether any transitional arrangements apply to their specific situation, and help them plan the most tax-efficient approach to their holiday let going forward; whether that means continuing to let, converting to long-term residential letting, or disposing of the property with careful CGT planning.

Overseas Landlords with UK Property

UK property owned by non-UK residents generates a UK rental income tax obligation regardless of where the owner lives. Non-resident landlords must register with HMRC, file annual UK Self-assessment returns, and; unless they hold approval under the Non-Resident Landlord scheme have tax withheld at source from their rental income by their letting agent or tenant before it is paid to them. The 60-day CGT reporting rule also applies to overseas landlords disposing of UK residential property, with no exceptions even where the disposal produces no gain.

As a practice serving both UK and UAE clients, we have specific expertise in advising overseas landlords with UK property; managing NRL scheme registration and approval, filing annual UK Self-assessment returns, advising on the UK Statutory Residence Test in the context of property ownership, and handling 60-day CGT returns on UK property disposals for non-resident clients based anywhere in the world.

Section 24: The Mortgage Interest Restriction

Section 24 of the Finance Act 2015 fundamentally changed how individual landlords are taxed on their buy-to-let properties. Before Section 24, mortgage interest was deductible from rental income before calculating the tax liability. Since the rules became fully effective in 2020, individual landlords can no longer deduct finance costs as an expense. Instead, they receive a 20 per cent basic-rate tax credit on finance costs; applied after the tax liability has been calculated on gross rental income.

The real-world effect is dramatic. A higher-rate taxpayer with £20,000 of rental income, £12,000 of mortgage interest, and £3,000 of other allowable expenses has a real commercial profit of £5,000. Under Section 24, their taxable income is £17,000 (after the £3,000 expenses but before mortgage interest), and their tax liability at 40 per cent is £6,800, reduced by the 20 per cent credit on £12,000 of finance costs (£2,400); leaving a net tax bill of £4,400 on a £5,000 real profit. The effective tax rate on actual commercial profit is 88 per cent.

Section 24 has no planned repeal. A specialist landlord tax accountant who manages this correctly; maximising allowable expenses, reviewing the property structure, and modelling the annual allowance position; is the most effective response to a restriction that cannot be avoided but can be managed.

Making Tax Digital for Landlords: Mandatory from April 2026

Making Tax Digital for Income Tax is mandatory for landlords whose gross property income exceeds £50,000 from 6 April 2026. The threshold drops to £30,000 from April 2027, and to £20,000 from April 2028. MTD changes both the process and the frequency of tax reporting:

Quarterly digital submissions replace the annual Self-assessment return. Landlords must maintain digital financial records and submit four quarterly updates to HMRC each tax year through HMRC-approved software, followed by a year-end finalisation return.

A points-based penalty system applies to missed submissions. Each missed quarterly update accrues one penalty point. Once four points are accumulated, a £200 penalty is charged; and the points continue to accumulate with each subsequent missed submission.

Gross income is measured, not profit. The £50,000 threshold is applied to gross rental income from all properties combined before any deductions. A landlord with two properties each generating £30,000 of gross rent and £20,000 of allowable costs has gross income of £60,000 and is in scope for MTD from April 2026, regardless of the fact that their actual profit is considerably lower.

For landlords who also have self-employment income, gross rental income and gross trading income are combined in assessing whether the MTD threshold is met.

We assess your MTD position, configure the right HMRC-approved software for your rental portfolio, establish your quarterly digital record-keeping process, and manage your four quarterly submissions and year-end finalisation on your behalf; so you are fully MTD-compliant before the first deadline and without the risk of penalty point accumulation.

New Property-Specific Income Tax Rates from April 2027

From April 2027, rental income will no longer be taxed at standard income tax rates. New property-specific income tax rates of 22 per cent (basic rate), 42 per cent (higher rate), and 47 per cent (additional rate) will apply to rental income: two percentage points above the standard rates that apply to employment income and other sources. Simultaneously, the mortgage interest credit for individual landlords will increase from 20 per cent to 22 per cent.

For higher-rate landlords, the rate increase from 40 to 42 per cent on rental income adds a meaningful additional cost: and the modest improvement in the mortgage interest credit does not offset it for most leveraged portfolios. For portfolio landlords generating material rental income, now is the time to model the April 2027 impact on their specific portfolio and consider whether restructuring decisions: incorporation, portfolio reduction, or alternative ownership arrangements; should be made before the new rates take effect.

Capital Gains Tax on Property Disposals: 60-Day Reporting

When a landlord sells a UK residential investment property, Capital Gains Tax applies on the gain at rates of 18 per cent (basic rate) and 24 per cent (higher rate), after the annual CGT exemption of £3,000. The 60-day reporting rule requires that a CGT return is filed with HMRC and any tax due is paid within 60 days of the completion date: not in January following the end of the tax year. This applies even where the property was jointly owned. It also applies to overseas landlords on every UK residential property disposal, whether or not a gain arises.

Pre-sale planning: reviewing the ownership structure, considering the timing of disposal, assessing Private Residence Relief where the property was ever the owner's main home, and reviewing whether a disposal in two tax years could reduce the overall liability: can make a material difference to the CGT cost of selling. We advise on CGT before exchange of contracts, prepare and file the 60-day return, and calculate the payment due to prevent late payment interest and penalties.

Landlord Tax Return: Self-Assessment & Rental Income Tax

We prepare your annual landlord tax return with a complete review of all rental income across every property you own, all allowable expenses correctly categorised, and the Section 24 finance cost credit correctly calculated and applied; before a single figure is submitted to HMRC. Allowable expenses for landlords typically include letting agent fees and management charges, property maintenance and repairs (correctly distinguished from capital improvements), buildings and contents insurance, ground rent and service charges on leasehold properties, accountancy fees, and the finance cost credit under Section 24.

For landlords who also have employment income, investment income, pension income, or other sources, we bring every element together into a single correctly prepared Self-assessment return: ensuring that the interaction between rental income and other sources, including the personal allowance taper above £100,000, is handled correctly and that no avoidable tax arises from incorrect ordering of income types.

Best for: Buy-to-let landlords, portfolio landlords, single property owners, and any landlord filing Self-assessment with rental income.

Making Tax Digital for Landlords: April 2026 Compliance

We assess whether you are in scope for Making Tax Digital for Income Tax from April 2026: reviewing your gross property income across all rental properties against the £50,000 threshold, and whether any self-employment income brings you into scope earlier. We configure the right HMRC-approved software for your portfolio size, establish your digital record-keeping process, and manage your four quarterly submissions and year-end finalisation return on your behalf.

For landlords who are not yet in scope in April 2026 but whose rental income is growing towards the thresholds that apply in April 2027 (£30,000) and April 2028 (£20,000), we advise on MTD readiness and preparation well in advance of each threshold; so the transition is managed rather than reactive. We also ensure that your quarterly submissions are consistent with your VAT returns, if applicable, and that your digital records correctly capture all rental income and allowable expenses each quarter.

Best for: All landlords with gross rental income approaching or above £50,000, those whose combined rental and self-employment income exceeds the MTD threshold, and landlords who want to establish MTD-compliant processes before any penalty risk arises.

Landlord Tax Advice: Year-Round Planning & Structuring

The single most effective way to reduce the tax burden on a rental property portfolio is year-round, proactive planning; not a reactive return prepared in January. As your specialist landlord tax accountant, we review your complete property tax position at least annually; modelling the Section 24 impact on your specific portfolio, reviewing the most efficient approach to the April 2027 rate changes, assessing whether incorporation makes financial sense for your circumstances, and identifying every legitimate planning opportunity available.

This includes: transferring a share of property ownership to a lower-rate-paying spouse or civil partner to utilise their basic-rate band, timing of property improvements to correctly distinguish between deductible repairs and capital expenditure, pension contributions to reduce adjusted net income, and the correct use of losses carried forward from earlier tax years where rental income fell short of allowable costs. We also advise on portfolio growth strategy; the tax implications of acquiring additional properties in a personal name versus a limited company, and the SDLT cost of further acquisitions at the current 5 per cent additional property surcharge.

Best for: Any landlord whose current accountant has not provided specific Section 24 planning advice, landlords approaching the April 2027 rate change who want to model its impact, and portfolio landlords reviewing whether their current structure remains tax-efficient.

Limited Company & SPV Accounting for Property Investors

We provide a complete accounting and tax service for landlords operating through a Special Purpose Vehicle or standard limited company including book-keeping across all rental properties held within the company, annual statutory accounts prepared in accordance with FRS 102, Corporation Tax filing, director salary and dividend planning, Companies House Confirmation Statement, and the personal Self-assessment return for each director.

We also advise on the internal financial management of property limited companies; optimal dividend payment timing, retained earnings strategy within the company, director loan account management, and the correct accounting for mortgage interest as a fully deductible business expense in the company context. For landlords holding multiple companies within a group structure, we manage the inter-company arrangements and the group tax position.

Best for: All landlords operating through a limited company or SPV, those who have recently incorporated and need ongoing company accounting, and limited company landlords whose current accountant does not have specific property limited company experience.

Landlord Capital Gains Tax Accountant: 60-Day Returns & Pre-Sale Planning

We advise landlords on Capital Gains Tax before any property disposal is made; reviewing the ownership structure of the property, the available allowances and reliefs (including Private Residence Relief where the property was the owner's main home at some point during ownership, and Lettings Relief in the limited circumstances where it still applies), the CGT rate applicable to the gain, and the cashflow timing of payment given the 60-day deadline.

Once a disposal completes, we prepare and file the CGT-on-UK-property return within the 60-day deadline, calculate the payment due (including any overpayment or underpayment from the estimate), and ensure the disposal is also correctly reflected in the year-end Self-assessment return. For overseas landlords, we file the mandatory 60-day return for every UK residential property disposal, whether or not a gain arises as the return is obligatory in all cases for non-resident sellers.

Best for: Landlords planning to sell a residential investment property, those who have recently sold and need the 60-day CGT return filed, and overseas landlords with UK property disposal obligations.

Landlord Book-keeping Services: Property Income & Expense Records

Accurate, well-organised financial records are the foundation of a correct landlord tax return, the prerequisite for Making Tax Digital compliance, and the basis of any meaningful tax planning. Our book-keeping for landlords service covers rental income recording across all properties, letting agent statement reconciliation, maintenance and repair expense tracking, mortgage statement and finance cost recording for Section 24 purposes, and insurance and service charge allocation.

We maintain your rental property records throughout the year across Xero, QuickBooks, FreeAgent, or Sage; and we configure your digital record-keeping to be MTD-compliant from the outset, with each property tracked separately as required from April 2027 when HMRC's MTD rules require disaggregated property-level reporting. For portfolio landlords managing large numbers of properties, we provide a fully managed book-keeping service that removes the administrative burden of property record-keeping entirely.

Best for: Portfolio landlords, limited company property investors, overseas landlords whose UK property is managed by a letting agent, and any landlord who wants their financial records maintained correctly throughout the year rather than assembled from receipts and statements in January.

Accountant for Overseas Landlords: UK Rental Income & NRL Scheme

Non-UK resident landlords with UK rental property must register with HMRC as a non-resident landlord, file annual UK Self-assessment returns reporting net rental profit, and either obtain approval under the Non-Resident Landlord scheme to receive rent gross or accept that their letting agent must withhold 20 per cent tax at source before remitting rental income. We manage NRL scheme registration and HMRC approval, prepare the annual UK Self-assessment return correctly from letting agent statements, and ensure any tax withheld under the NRL scheme is correctly credited against the annual liability with any overpayment promptly reclaimed.

For UAE-based landlords with UK property: one of the most common client profiles for our practice; we also advise on the UK Statutory Residence Test in the context of UK property ownership, the interaction between UAE residency and UK tax obligations, and the CGT position on UK residential property disposals for clients based in the UAE.

Best for: Overseas landlords with UK property, UAE-based clients managing UK rental portfolios, and non-UK residents who have sold UK property and need the mandatory 60-day CGT return filed.

Property Incorporation Analysis: Is an SPV Right for Your Portfolio?

We provide a structured financial analysis of property incorporation for landlords who are considering moving a personally-held portfolio into a limited company. The analysis covers the estimated Capital Gains Tax on the transfer of each property (based on current market value versus original purchase cost and capital improvement history), the SDLT cost of the company acquisition at current rates including the 5 per cent additional property surcharge, the Section 24 tax saving within the company structure, the year-by-year cashflow comparison between personal ownership and limited company ownership, and the break-even point at which the ongoing Section 24 saving covers the upfront CGT and SDLT costs of incorporation.

We will not recommend incorporation unless the analysis supports it for your specific portfolio. For many landlords with smaller or less leveraged portfolios, the upfront transfer costs outweigh the Section 24 saving for a considerable number of years. For others with large, highly mortgaged portfolios, incorporation makes compelling financial sense. The answer depends entirely on your numbers; and we produce those numbers before you commit to anything.

Best for: Portfolio landlords actively considering incorporation, landlords who have been advised to incorporate without receiving a specific financial analysis, and any landlord currently paying what feels like an unreasonable tax bill on a portfolio that generates modest real commercial profit.