Making Tax Digital landlord compliance costs UK, Digi Mart USA News (United Kingdom): Running a rental business in the UK is becoming an administrative job in its own right. Digital tax reporting alone is expected to cost landlords between two and four working days a year, according to new research from landlord property management platform, August.
The findings come two days after the second quarterly Making Tax Digital deadline on Saturday 7 November.
The August Landlord Survey 2026, completed by 276 UK landlords in September, asked landlords in scope for Making Tax Digital how much extra time each quarterly update takes. Three-quarters (75%) expect at least four hours, 41% expect four to eight hours and a third (34%) expect more than a day.
Only 6% expect less than an hour. Across four quarterly updates, that is 16 to 32 hours a year for most landlords in scope, and more than 32 hours for a third of them.
Compliance is also reshaping how landlords manage. Two-thirds (65%) have changed their management arrangements in the last two years. 27% have left a letting agent and now self-manage, 26% have started using an agent, and 12% have switched agents.
Asked why, the most common reason was compliance and legal complexity (27%), ahead of wanting more control (22%), poor service (20%) and the cost of fees (14%).
That cost is substantial. Among landlords who pay or have paid for management, 58% pay 11% of rent or more, and nearly one in ten pay more than 15%.
On five properties letting at £1,000 a month, a 12% management fee is £7,200 a year. Yet 69% of landlords say they are likely to be self-managing all their properties within two years, including 58% of those who currently use an agent.
Legislation is landlords’ single biggest worry over the next twelve months (26%), ahead of void periods (19%), mortgage rates (19%) and tax (13%). Only 2% say nothing in particular worries them.
“Government has been adding obligations to landlords for a decade without anyone tracking the hours,” said Richard Samuel, Chief Executive of August.
“Quarterly digital tax reporting is the first one landlords can put a number on, and it is days, not minutes. Add the new database, the ombudsman, periodic tenancies and the paperwork around every rent increase, and the small landlord is now running a compliance function with no staff.
“Some will pay an agent, some will leave, and the rest need tools that do most of this for them. That is what the next few years of the sector look like.”
