Simpler ways to keep MTD records: joint lets, small turnover and late figures

acrenvo.com/guides/mtd-simpler-record-keeping, last reviewed 25 October 2026

Making Tax Digital (MTD) for Income Tax allows simpler digital records in some cases. GOV.UK says you can create and categorise your records in a particular way if you jointly let property with another landlord, your self-employment or UK property turnover is below the VAT threshold or you are a retailer. With a turnover under £90,000 you can also categorise your records in less detail, and GOV.UK says: “If you’re a sole trader, you only need to record whether a transaction is income or an expense.” Landlords with residential property still record a little more, as the section on simpler categories explains.

Callum is fictional, but his situation is a familiar one. He and a friend bought a flat together a few years ago and let it out, and Callum also does a little self-employed work on the side, building websites for local businesses in the evenings. Now that he is using Making Tax Digital (MTD) for Income Tax, he wants to know how much detail his records really need. Keeping every receipt for the flat in a separate line, sorted into the right category, sounds like a lot of work for a modest income. This guide walks through the simpler options GOV.UK describes, who can use each one, and what still has to be done.

If you want the basic rules first, such as what every digital record must hold, the guide to digital records for MTD covers them.

Who can keep simpler records

GOV.UK groups the simpler options under three kinds of situation. In its words, you can choose to create and categorise your digital records in a particular way if either:

• you jointly let property with another landlord
• your self-employment or UK property turnover is below the VAT threshold
• you are a retailer

Each of these is an option you can choose, and you can keep fuller records if you prefer. Callum fits the first two, because he lets a flat with someone else and his turnover is small, so the sections below follow the order in which they apply to him.

Records for a property you let jointly

The first saving for a joint landlord is that you only deal with your own part. A landlord who jointly lets property only needs to create digital records for their own share of the income and expenses, and does not need to link those records to the other landlord's records. Callum and his friend can each keep records of their own share without needing the other’s.

On top of that, there are two easements for jointly let property, and you can use either of them or both.

• You can create less detailed digital records for jointly let property: a single record for each category of property income in an update period, and a single record for each category of property expense in a tax year.
• In your quarterly updates you can choose to include either the income and expenses for jointly let property, or the income only.

Leaving out the expenses means you do not have to sort the shared bills into your records as the year goes on. If you have chosen not to include expenses which relate to jointly let properties in your quarterly updates, then you do not need to create digital records for those expenses every quarter. The expenses do still have to be reported, though, and GOV.UK gives two ways to do it. If you do not include expenses in your quarterly updates, you will need to add this information before you submit your tax return. You can either:

• resend the fourth quarterly update to include these records after the tax year has ended
• adjust the category total in your software and update your digital records (if you have an agent, they may add information this way and ask you to update your records)

The easement for leaving out expenses only covers the shared property. If you also own other property outright, your quarterly updates must still include both the income and the expenses for those properties. The guide for joint property owners explains how each owner’s share is counted in the first place.

Simpler categories when turnover is under £90,000

The second option is about how finely you sort your records, and it is open to sole traders and landlords alike. You can choose to categorise your digital records in less detail for a tax year, if you have any of the following:

• total UK property turnover of less than £90,000 (this also applies if you are a landlord that jointly lets a property)
• turnover from a source of self-employment that is less than £90,000
• foreign income

The test works on each income source rather than on your income as a whole, which matters for someone like Callum with both a letting and a small business. If you have more than one source of self-employment or UK property income, you can only use simpler categorisation for both income sources if your turnover is below the VAT threshold for each income source.

What the simpler level asks of you depends on the kind of income. For self-employment it asks for very little. If you’re a sole trader, you only need to record whether a transaction is income or an expense. Residential lettings need a little more. If you’re a landlord and receive UK property income from residential property, you need to categorise your expenses in more detail even if your turnover is below the threshold. You must:

• record if a transaction is an income or an expense
• if it is an expense, record whether the expense is for a restricted finance cost

For Callum, that means his evening web work only needs each transaction marked as income or an expense, while his share of the flat also needs any restricted finance cost picked out from the other expenses. Property abroad is treated a little differently. GOV.UK lists foreign income among the cases in which you can choose to categorise your digital records in less detail for a tax year, and it says that the turnover threshold that applies to simpler categorisation does not apply to foreign property income.

If your turnover reaches £90,000

Simpler categorisation is chosen for a tax year, so it is worth knowing what happens if a business grows faster than you expected. If your turnover reaches £90,000, you will need to categorise all digital records for that income source in full before you can send your quarterly update, including those:

• from the beginning of the current tax year
• in the following tax year

If you think you might get close to the figure, GOV.UK’s advice is to start with full detail. If you’re unsure if your turnover will reach £90,000, you should categorise your digital records in full detail.

The same figure is the VAT registration threshold, so a business that reaches it may need to register for VAT as well. The guide to reaching the VAT threshold explains what changes for both taxes, and the guide to keeping records for VAT and Income Tax covers the records side.

One email a month lists the MTD software price changes we have checked and any changes to HMRC’s list of software. If that would be useful, you can sign up for the monthly price-changes email at the end of this page.

If you are a retailer

Retailers have a simpler route of their own for recording sales. You can choose to create a digital record of your daily gross takings, instead of individual sales that you make.

When you only learn the figures later

Some income reaches you as a single figure after costs, or arrives long after the quarter it belongs to. GOV.UK sets out what to do in each case.

If you only know your net income

This can happen with a jointly let property, where the other owner or an agent pays you what is left after the bills. For your records, if you only know what your income is after expenses are deducted (also known as net income) you need to:

• ask what the full amount of income was before expenses were deducted
• create a digital record for the full amount of income
• create a digital record for your expenses

This is a different question from whether you need to use MTD at all. For that test, a separate GOV.UK page says that if you jointly own a property and only receive notice of your share of the income after expenses have been deducted, HMRC assesses that figure as your qualifying income. If it is a letting agent who pays you the rent after their fee, the guide to MTD when a letting agent collects your rent turns one of their statements into records.

If a trust or partnership tells you about your income

If a trust or partnership tells you about your personal self-employment or property income after the quarterly update deadline, you can either:

• estimate your income or expense and then confirm it later
• record the income or expense once you are notified of it

This includes disguised investment management fees or income based carried interest. A partnership share is treated differently. Your share of profit from a partnership as an individual partner does not count towards your qualifying income, and you do not need to keep digital records or send quarterly updates for it. Partnerships will need to use MTD for Income Tax in the future, on a timeline HMRC has not yet set out.

If you estimate the income or expense

If you choose to estimate, GOV.UK says you should:

• create a digital record for the transaction
• update the digital record when the income or expense is confirmed

It will then be included in your next quarterly update. If you have already sent your fourth quarterly update, you will need to resend the update to include the confirmed income or expense.

If you only record it once it is confirmed

If you would rather wait for the confirmed figure, GOV.UK says you should:

• send quarterly updates during the tax year that confirm you received no income and incurred no expenses for that income source
• create a digital record for the income or expense when you receive the information

It will then be included in your next quarterly update. If you have already sent your fourth quarterly update, you will need to resend the update to include the confirmed income or expense. You will need to have finalised your digital records before you submit your tax return.

If you signed up partway through the year

Joining MTD after the tax year has started does not mean the earlier months can be skipped. If you signed up for Making Tax Digital for Income Tax partway through the tax year, you’ll need to catch up with your record keeping by creating digital records from the start of the tax year. The records will then be included when you submit your first quarterly update. GOV.UK adds that there are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year. The MTD penalties guide explains what applies after that year.

Questions about simpler record keeping