If you own rental property in Cardiff, whether a student let in Cathays, a family home in Pontcanna, or a portfolio of flats across Grangetown and Cardiff Bay, a significant tax change is now firmly on the horizon.Making Tax Digital for Income Tax Self Assessment, known as MTD for ITSA, is being rolled out in stages, and many Cardiff landlords are now reviewing their record-keeping and reporting processes to ensure they meet HMRC’s digital requirements.
This guide explains what is changing, who is affected, and how you can prepare without unnecessary stress.
What is making tax digital for income tax?
Making Tax Digital is a government initiative designed to modernise the UK tax system. Under MTD for ITSA, landlords and self-employed individuals are required to keep digital records and submit quarterly updates to HMRC through compatible software rather than filing a single annual Self Assessment return.
The shift is significant. Instead of one return per year, you will report income and expenses to HMRC four times a year, with a final end-of-period statement to confirm your figures.
Who does this affect in Cardiff?
From April 2026, MTD for ITSA applies to anyone with a combined gross income from self-employment and property of more than £50,000 per year. Landlords who fall within the scope of MTD for ITSA must keep digital records and submit information to HMRC using compatible software.
From April 2027, the threshold drops to £30,000, bringing a much larger group of Cardiff landlords into scope.
Given that rental values across Cardiff have continued to rise into 2026, with average monthly rents in CF24 postcodes such as Cathays and Roath sitting well above £1,100 per calendar month for a two-bedroom property, many landlords will find themselves approaching or exceeding these thresholds sooner than expected.
High-yield areas to watch
Postcodes CF24 and CF11 have seen some of the strongest rental income growth in the city. Landlords with properties near Cardiff University, Cardiff Metropolitan University, or the regenerated waterfront areas of Cardiff Bay are particularly likely to be affected, especially those managing multiple properties or combining rental income with other self-employed earnings.
What records do Cardiff landlords need to keep?
Under MTD for ITSA, you must maintain digital records of all property income and allowable expenses. This includes:
Rental income received from each property, including any payments made by contract holders for services such as utilities where these pass through your accounts.
Allowable expenses such as letting agent fees, repairs and maintenance, insurance, mortgage interest (subject to current relief rules), and accountancy costs.
Details of any other income streams that combine with your rental income to meet the reporting threshold.
Records must be kept in HMRC-recognised software. Spreadsheets alone will not be sufficient unless they are linked to compatible bridging software.
Which income streams are affected?
It is not just rent that counts. If you earn income from furnished holiday lets, short-term lets through platforms, or any self-employed work alongside your rental portfolio, all of these may contribute to the threshold calculation.
Cardiff landlords managing houses in multiple occupation, portfolios of flats in developments such as those around Central Square or Atlantic Wharf, or a mix of long-term lets and short-term arrangements should review their total gross income carefully.
How digital reporting changes day-to-day management
The practical impact of MTD is that record-keeping needs to become a regular habit rather than an annual task. Quarterly submissions mean you will need up-to-date figures every three months.
For landlords managing properties across Splott, Roath, or the growing residential areas of Grangetown, this may mean adopting new software, changing how you store receipts, and setting calendar reminders for submission windows.
The good news is that many property management platforms already integrate with HMRC-compatible software, and a number of accountancy tools now offer landlord-specific packages. Getting set up early gives you time to test your processes before the 1 June 2026 deadline arrives.
Common mistakes to avoid
Waiting until the last minute to register with HMRC for MTD is one of the most common errors. Registration, software selection, and migration of existing records all take time.
Failing to include all income sources in your threshold calculation is another risk, particularly for landlords who may not realise that gross income, not net profit, is what HMRC uses to assess eligibility.
How a local letting agent can reduce your compliance risk
Working with a professional letting agent does not remove your personal tax obligations, but it does make the record-keeping side considerably more manageable. When your agent handles rent collection, maintenance coordination, and contract holder communications, the financial records associated with your property are more organised from the outset.
At Belvoir Cardiff, we work with landlords across the city, from single-property owners in Pontcanna to portfolio landlords with multiple units across CF24 and CF11. We understand the Cardiff rental market and the specific pressures that come with managing property in high-demand areas near the university, the city centre, and the bay.
Having accurate, clearly documented rental income records is a strong foundation for MTD compliance. Belvoir Cardiff can help ensure your letting management supports that process.
A note on Welsh legislation
Cardiff landlords must also remain compliant with the Renting Homes (Wales) Act 2016, which governs the relationship between landlords and contract holders in Wales. While MTD is a UK-wide tax initiative, your obligations under Welsh law, including written occupation contracts and fitness for human habitation requirements, run alongside your tax responsibilities. Staying on top of both is part of being a compliant landlord in Cardiff.
Getting ready before the deadline
With MTD for ITSA now becoming a reality for many landlords, preparing sooner rather than later can help avoid unnecessary disruption. If your gross property and self-employment income exceeds £50,000, now is the time to act.
Review your total gross income across all sources. Speak to a qualified accountant familiar with landlord taxation. Choose HMRC-compatible software and begin keeping digital records immediately. Register for MTD for ITSA through HMRC before the deadline.
If you are unsure whether your income meets the threshold, or if you want to understand how professional letting management could simplify your compliance journey, Belvoir Cardiff is here to help.
Take the next step with Belvoir Cardiff
Whether you are a first-time landlord in Cathays or an experienced portfolio investor with properties across Cardiff Bay, Grangetown, and Roath, getting ahead of Making Tax Digital is one of the most important things you can do for your portfolio this year.
Book a valuation today to understand what your Cardiff property is worth in the current rental market, and speak to our team about how managed letting services can support your ongoing compliance responsibilities and help keep your property records organised and up to date.
Contact Belvoir Cardiff directly to discuss your portfolio, ask about our letting management services, or find out how we support landlords across the city with everything from contract holder management to day-to-day property administration.
