Does Making Tax Digital apply to limited companies?

In short: Partly. MTD for Income Tax, required from 6 April 2026 for sole traders and landlords with qualifying income over £50,000, does not apply to a limited company, which reports its profits on a CT600 (GOV.UK: When you need to use Making Tax Digital for Income Tax). HMRC says it does not intend to introduce MTD for Corporation Tax. MTD for VAT does apply to VAT-registered companies.

A company and its director are separate taxpayers. The company's profits go on its Company Tax Return (CT600), while a director's own sole-trade or rental income is a personal matter that can bring the director into MTD for Income Tax. If your rental properties sit in a company, take the 30-second check to see whether Taxley fits your company.

Does MTD for Income Tax apply to limited companies?

No: MTD for Income Tax applies to individuals, and a limited company is not one of the taxpayers it covers. GOV.UK says you need to use MTD for Income Tax if you are a sole trader or landlord registered for Self Assessment, with qualifying income from self-employment or property above the threshold (GOV.UK: When you need to use Making Tax Digital for Income Tax).

A limited company pays Corporation Tax on its profits instead, and the charge to Corporation Tax on income applies to the profits of a company's property business (Corporation Tax Act 2009, section 209). The company reports those profits on its own Company Tax Return, not on a director's Self Assessment return, and it files that return whether or not any director is in MTD.

The only kind of company named in HMRC's MTD for Income Tax exemption guidance is a non-resident company submitting an SA700 return, and that company is automatically exempt (GOV.UK: exemptions).

Does MTD for VAT apply to limited companies?

Yes: MTD for VAT applies to limited companies that are VAT-registered, whatever their turnover, unless HMRC has granted an exemption. MTD for VAT has applied since April 2019 to businesses with taxable turnover above £85,000, and from April 2022 it became mandatory for all VAT-registered businesses regardless of turnover (HMRC news, 7 January 2022).

VAT Notice 700/22 says MTD for VAT requires VAT-registered businesses to keep records digitally and file VAT Returns using software (VAT Notice 700/22). HMRC now signs up new VAT-registered businesses automatically unless they are exempt or have applied for exemption (GOV.UK: register for VAT), and its July 2026 roadmap update puts the number of businesses using MTD for VAT at 2 million.

A property company has MTD for VAT duties only if it is VAT-registered. Letting land and buildings is normally exempt from VAT, though holiday accommodation is standard-rated, and an option to tax can make commercial lettings taxable but has no effect on residential lettings (VAT Notice 742; VAT Notice 742A). Exempt income is left out of the taxable turnover tested against the £90,000 registration threshold (GOV.UK: Register for VAT: When to register for VAT).

Is there Making Tax Digital for Corporation Tax in 2026?

No: there is no MTD for Corporation Tax, and HMRC has said it does not intend to introduce it. HMRC's Transformation Roadmap, published on 21 July 2025, states that "HMRC do not intend to introduce MTD for CT", and says HMRC is instead developing an approach to Corporation Tax administration suited to the varied companies and organisations that pay it (HMRC's Transformation Roadmap).

HMRC's progress update, published in July 2026, mentions MTD only for Income Tax and VAT, and says work on HMRC's legacy Corporation Tax systems is expected to be completed in 2028 (HMRC Transformation Roadmap: update 2026). Companies therefore keep filing one Company Tax Return per accounting period.

The changes coming for companies concern the format of the Company Tax Return, not quarterly reporting. As announced at Budget 2025, HMRC is introducing a prescribed, fully tagged format for Corporation Tax computations, and it will become mandatory to file amended returns online (GOV.UK consultation). The consultation, open from 10 March to 2 June 2026, asked about timing, enforcement and exemptions: it sets out a live pilot from October 2027 to September 2028 and proposes online-only amendments from 1 April 2027. GOV.UK showed no published response on 24 September 2026.

Do property companies need MTD?

Not for Income Tax: the rent is the company's income, taxed through Corporation Tax on a CT600. A property company needs MTD for VAT only if it is VAT-registered, for example after opting to tax commercial property.

The company files one Company Tax Return per accounting period, due 12 months after the period ends, and usually pays its Corporation Tax 9 months and one day after the period ends. Once HMRC has sent a notice to deliver a return, the company must file even if it makes a loss or has no Corporation Tax to pay (GOV.UK: Company Tax Returns). Rent the company receives is not the director's personal income, so it is not on the director's Self Assessment return, which is the return HMRC checks to measure qualifying income. A landlord with properties both in a company and in their own name counts only the gross rent from the properties held personally. See Corporation Tax for a property company for how the company's rental profit is taxed.

A landlord moving every personally owned property into a company should read GOV.UK's guidance on ceased income, which explains what to tell HMRC once all self-employment and property income has stopped (GOV.UK: Work out your qualifying income for Making Tax Digital). Moving a portfolio into a company has its own tax costs, so take advice first.

Who in my set-up needs MTD?

Whether MTD applies depends on who receives the income: the company, you personally, or you jointly with someone else. A company never uses MTD for Income Tax, a VAT-registered company uses MTD for VAT, and a director's personal rent or sole-trade income is measured separately against the MTD for Income Tax threshold.

Checked on 24 September 2026 against GOV.UK. An exemption, such as digital exclusion, can override the personal columns.

Can a company director still need MTD for Income Tax?

Yes, for income the director receives personally, but not for salary or dividends from the company. GOV.UK counts only gross self-employment and property income as qualifying income, and lists employment (PAYE) and "dividends (including those from your own company)" as income that does not count (GOV.UK: Work out your qualifying income for Making Tax Digital).

A director who also runs a sole trade or lets property in their own name needs MTD for Income Tax if that qualifying income is over £50,000 for 2024 to 2025 (from 6 April 2026), £30,000 for 2025 to 2026 (from 6 April 2027) or £20,000 for 2026 to 2027 (from 6 April 2028), unless exempt. A jointly owned property counts by the owner's share. See who has to use MTD for Income Tax and MTD for landlords.

Where does Taxley fit if your property is in a company?

Taxley covers the company's side only: it prepares the company's CT600, FRS 105 or FRS 102 Section 1A accounts and tax computation in iXBRL, and files the return to HMRC with the company's own Government Gateway login. For property companies it carries UK property business losses forward.

Taxley also files the company's accounts at Companies House, at no extra cost, but it does not give tax advice. See filing a property company tax return with Taxley.

Frequently asked questions

Does my limited company need MTD software?

Only for VAT, if the company is VAT-registered. For Corporation Tax, the company needs commercial software to file its CT600, because HMRC's own online filing service closed on 31 March 2026; paper is allowed only with a reasonable excuse or in Welsh.

Do dividends from my own company count for MTD?

No. GOV.UK lists dividends, including those from your own company, and PAYE salary as income that does not count towards MTD qualifying income. Only gross self-employment and property income count.

Does a property company send quarterly updates to HMRC?

No. Quarterly updates belong to MTD for Income Tax, which does not cover companies. A property company files one Company Tax Return within 12 months of its accounting period end and usually pays Corporation Tax 9 months and one day after that period ends.

When will MTD for Corporation Tax start?

No start date exists. HMRC said in its Transformation Roadmap of 21 July 2025 that it does not intend to introduce MTD for Corporation Tax, and its July 2026 progress update mentions MTD only for Income Tax and VAT.

Is the Company Tax Return changing instead?

Yes, in format rather than frequency. HMRC is introducing a prescribed, fully tagged format for Corporation Tax computations and will make online filing of amended returns mandatory. It consulted until 2 June 2026 on timing, enforcement and exemptions, and had published no response by 24 September 2026.