How to keep digital records for rental income

Making Tax Digital requires landlords to keep digital records of their rental income and expenses — not at the end of the year, but throughout it. This guide explains what you need to record, what format is acceptable, and how to stay organised across one or more properties. Reviewed May 2026.

What you must record

For each rental property, you need to keep a digital record of:

Income:

• Rent received (date and amount for each payment)
• Any other income from the property — service charges passed through, late payment fees, or other receipts

Expenses:

• Every allowable expense paid in the tax year
• For each expense: date, amount, category, and enough description to identify it
• Which property the expense relates to

What counts as an acceptable digital record

HMRC requires records to be kept in a digital format through software that can connect to their MTD systems. This means:

• Records held in MTD-compatible software (such as TenancyVault)
• Records that feed into your quarterly submissions automatically
• Not a paper-based system

A standalone spreadsheet does not meet the requirement on its own. Unless your spreadsheet connects to HMRC through a bridging tool, it is not an acceptable MTD digital record.

How to organise records across multiple properties

If you have more than one rental property, HMRC may treat them as a single UK property income business (unless one is a foreign property). Even so, keeping records property by property helps you:

• Identify which property is profitable or has high maintenance costs
• Assign expenses to the correct property for HMRC
• Review each property’s quarter totals before submitting

In TenancyVault, each property is assigned to an MTD business source. Records for each property feed into the correct business totals in your quarterly submission.

What records to keep and for how long

HMRC expects you to keep supporting records — bank statements, receipts, invoices, and similar documents — that back up the figures in your digital records. The general requirement is to keep these for at least five years after the 31 January submission deadline of the relevant tax year.

Practical tips:

• Keep PDF receipts and invoices in a document folder alongside your digital records
• Label expenses with the invoice or reference number if you have one
• For bank-imported transactions, keep the original bank statement as a reference

How often should you update your records?

You do not need to update your records daily, but you should keep them up to date enough that your quarterly totals are accurate when the quarter ends. Leaving everything to the last week before the quarterly deadline makes errors more likely.

A practical approach is to review and update your records monthly — import bank statements, categorise new transactions, and check for missing entries.

Common mistakes

• Mixing personal and business accounts — keeping a separate bank account for your rental income and expenses makes record-keeping much simpler and reduces the risk of missing a transaction
• Recording gross amounts instead of net — record the actual amount you paid or received, not VAT-adjusted figures (most residential landlords are not VAT registered)
• Forgetting quarterly interest entries — if you pay mortgage interest quarterly or annually, split it across the correct months in your records
• Not linking expenses to the right property — expenses must be attributed to the property they relate to

How TenancyVault helps

TenancyVault is designed around property-level record keeping. You log income and expenses per property, import bank statements and review transactions, and the app calculates your quarter totals ready for submission. Records are digital from the moment you enter them and connect directly to your HMRC quarterly filing.

Not legal or tax advice. This guide is for information only. Consult a qualified accountant or tax adviser for guidance on your specific situation.