Being a landlord in 2026 is rewarding, but it has no doubt become a bit more complicated. More admin and more changes are on the cards for UK landlords, so it's never been as important to keep on top of it.

If you didn't already know, Making Tax Digital (MTD) is live, property income tax rates are set to rise from April 2027. And in England, the Renters' Rights Act introduced earlier this year has changed how tenancies end. These are just a few of the changes to keep on top of for UK landlords.

And if you've feeling overwhelmed, you're not alone. While we can't change the rules at Bionic, we can guide you through them in this guide. We'll explain what you need to know and how this could impact your landlord insurance, as well as practical steps you can take now – so you feel armed with the knowledge and perhaps a bit more confident when it comes to knowing what to do next.

_{This content is provided for general informational purposes only and does not constitute tax, legal, or financial advice. You should not rely on it as a substitute for professional advice. Always seek independent advice from a qualified professional regarding your specific circumstances.}

Table of contents

• What are the landlord tax changes for 2026–27?
• Key dates for landlords: 2026 to 2031
• Is landlord insurance tax deductible?
• Which landlord insurance costs can you claim? (by cover type)
• Working example: what you might need to pay
• How to use MTD (Making Tax Digital)
• The Renters' Rights Act and your insurance
• Real-world landlord examples
• Landlord tax and insurance FAQs

What are the landlord tax changes for 2026–27?

There have been several tax changes for landlord announced in 2026–27. These are new rules that change how much tax you pay on rental profit. HMRC have also changed how you need to report it.

We've broken down the three main tax changes below.

Landlords now need to use Making Tax Digital (MTD)

Making Tax Digital (MTD) for Income Tax is HMRC's new way of reporting income from property and self-employment. Since April 6, 2026, it also applies to qualifying landlords and sole traders with an annual turnover of more than £50,000 and it's set to get stricter in the following years. So, it's best to start preparing for this now (if you haven't already).

You'll need to:

• Sign up on the government website
• Keep digital records of your rental income and expenses
• Send HMRC a quarterly update digitally, 4 times a year
• Submit a final tax return by January 31, after the tax year ends

Remember, these are updates on income and expenses, they're not extra quarterly tax returns.

How to work out your qualifying income:

Qualifying income is your total income (also known as turnover) from self-employment and property before expenses, and it's based on your previous tax return. If you have any rent from a jointly owned property - it only counts your share. It could include:

Sources of income that can count:

• Employment (PAYE)
• Your share of profit from a partnership as an individual partner
• Dividends (including those from your own company)
• A State Pension
• Private pensions

Upcoming changes to qualifying thresholds

• From April 2027, the threshold is set to change to £30,000
• And from April 2028, the threshold is set to drop to £20,000

You can check if and when MTD applies to you on the government website.

Will I get a penalty for missing the deadline?

For the 2026 to 2027 tax year, HMRC has confirmed there are no penalties for missing a quarterly update deadline. But from April 6, 2027, you may get a penalty for missing the update.

Property income tax rates rise from April 2027

As you may already know, property income tax rates are a separate set of Income Tax rates for rental profit only. So, if you're a landlord with regular income, it's worth knowing this is set to rise next year. Below is a comparison of the property income tax rates for this year and the increases in 2027:

Tax band	Property rate from 2026–27	Property rate from April 6, 2027
Basic rate	20%	22%
Higher rate	40%	42%
Top rate (income over £125,140)	45%	47%

_{Source: HMRC technical note, November 2025. Applies to England, Wales and Northern Ireland.}

But you also should consider how your personal allowance plays into this from next year. In April 2027, your Personal Allowance will set against wages, trading or pension income first and, any allowance left over is then set against property income.

This could mean more of your rental profit is taxed at the new property rates. HMRC's own example shows someone with a £30,000 salary and £3,000 of rental profit. In that case a landlord's rental profit is taxed at 22%, giving £660 of tax on it.

It's worth remembering that income tax thresholds are frozen until April 2031, so if you put up your rent, more of your profit could slip into the higher band, meaning you might pay more tax from next year.

Other changes landlords should watch out for

• Limited company landlords - Dividend tax rates rose earlier this year. The ordinary rate is now 10.75% and the upper rate is 35.75%, according to HMRC.
• High-value homes in England – If you own a residential property that's worth more than worth £2 million or more in 2026, a High Value Council Tax Surcharge is set to come into play in April 2028. It applies to owners of residential property and owners pay it, not tenants.
• Renters' Rights Act - Phase one started in England on May 1, 2026. It isn't a tax but may influence the risks you decide to insure against. Read more in our guide to the renter's right act for landlords.

Key dates for landlords: 2026 to 2031

Date	What changes	Who it affects
April 6, 2026	Making Tax Digital (MTD) is live for landlords with income over £50,000	Landlords and sole traders earning over £50,000
May 1, 2026	Renters' Rights Act phase one, Section 21 ends	Private landlords in England
August 7, 2026	First MTD quarterly update deadline (6 April to 5 July)	MTD landlords
November 7, 2026	Second quarterly update deadline (6 July to 5 October)	MTD landlords
January 31,  2027	2025–26 tax return and payment deadline	All landlords who fill in a self assessment
February 7, 2027	Third quarterly update deadline	MTD for landlords
April 6, 2027	New property rates (22%, 42%, 47%). Finance cost credit rises to 22%. Personal Allowance order changes. MTD threshold falls to £30,000. Penalty points begin for late quarterly updates	Landlords in England, Wales and Northern Ireland
May 7, 2027	Fourth quarterly update deadline for 2026–27	MTD for landlords
January 31, 2028	First MTD tax return due for 2026–27	MTD for landlords
April 2028	MTD threshold falls to £20,000. High Value Council Tax Surcharge is set to come in	Smaller landlords. Owners of £2m+ homes in England.
April 2031	Current Income Tax threshold freeze ends	All taxpayers

Is landlord insurance tax deductible?

Yes, business cover is typically an allowable expense. This means you can deduct the premium from your rental income before working out your taxable profit. Learn more about residential landlord insurance.

Is Insurance Premium Tax deductible?

Insurance Premium Tax (IPT) is a tax on general insurance premiums. The standard rate is 12%, and you don't pay VAT on insurance. IPT is already included in the price you pay. You claim the total amount you pay for the policy, which includes the IPT.

What insurance isn't tax deductible?

• Insurance on your own home, where you live
• Content insurance arranged by your tenants'
• Cover that protects you personally rather than your rental business, such as life insurance

If one policy covers both your home and a let part of it, you may want to consider splitting up the cost. Always seek your own financial advice when it comes to tax matters.

Which landlord insurance costs can you claim? (by cover type)

Policies vary per insurer and limits and exclusions apply. Below are some cover types they may included on one landlord policy. You should always check your own policy documentation to see which covers are included and which are not.

Residential Landlord insurance and commercial landlord insurance may include:

Building insurance

Protects your building from unforeseen property damage including fire, storms, floods but also arsonists and vandalism. Learn more about building insurance.

Landlord contents insurance

Covers repair costs from damages to contents you own in the property, for example carpets, furnishings, and lights. Not tenant's belongings.

Loss of rent receivable insurance

In case your current tenant needs to alternative accommodation due to an unhabitable property. You can only claim if you have current tenancy agreement in place. Learn more about loss of rent insurance.

Legal expenses insurance

Legal expenses insurance is a type of business insurance cover that helps pay the legal costs of a dispute, whether you raise the claim or one is made against you. For landlords, it could include property protection.

Unoccupied property cover

If your rental property is empty for longer than your policy allows, your cover could change. Check your policy wording for details often under 'unoccupancy conditions' or similar. Read our guide to how unoccupancy affects your insurance to find out more.

Landlord insurance and tax at a glance

Cover type	Is the premium usually tax deductible?	How a payout is usually treated
Building insurance	Yes	Set against the cost of repairs
Landlord contents insurance	Yes, for items you provide	Set against repair or replacement costs
Loss of rent receivable	Yes	Taxed as rental income
Legal expenses cover	Usually, if for the rental business	Legal costs paid directly
Unoccupied property cover	Yes, if the property is held for letting	Set against the cost of repairs
Insurance Premium Tax (12%)	Yes, as part of the premium	Not applicable
Insurance on your own home	No	Not applicable

Landlord insurance and submitting MTD

As mentioned with MTD for landlords, you need to submit a quarterly update to HMRC, this means any insurance premiums you take out during the year need to be included in the next quarter's entry.

Here is what you should do:

• Keep a digital record of your premiums – You should have received a digital policy schedule from your broker. Note the date paid, the insurer, the property, the amount including IPT, and the period you are covered for.
• Use the right expense category – HMRC's MTD update notice groups insurance with "rent, rates, insurance and ground rents", so you should consider it's under the right category when submitting the update.
• Split costs if you own jointly – If your own a residential property with someone else, you should split your share of income and expenses when submitting an update.
• Record any payouts as income – If you have received a payout from a claim on your landlord insurance, this should be included as property income, not as negative expenses.
• Keep your policy documents with your tax records – Your schedule, renewal notice and receipts could help if HMRC asks questions about your insurance, so it's best to keep them stored digitally in a file you can easily access.

What to do if you're joint property owners?

If you own a property with someone else, it's good to remember that HMRC still looks at each person separately. Only your share of the rental income counts towards your qualifying income for MTD.

For example, if you and your brother jointly own a property with £50,000 of rental income, this split equally is £25,000. This means you each have £25,000 of qualifying income from as rental income.

The Renters' Rights Act and your insurance

The Renters' Rights Act 2025 that was introduced on May 1, 2026 saw the biggest change to private renting in England in more than 30 years.

To recap, key changes for landlords in England include:

• No more Section 21 - You now need a legal reason (a Section 8 ground) to regain possession
• Fixed terms are now replaced by rolling tenancies - Tenants can end a tenancy at any point with two months' notice
• Rent increases are limited - Rent can usually only rise once a year, with two months' notice

Note: The Renters' Rights Act doesn't apply to Scotland, Wales and Northern Ireland so if you run a business in these countries, you should check relevant tenancy laws.

What this could mean for your landlord cover

• Possession now depends on evidence - With the introduction of Section 8, you need to prove why you need to have your property back. Legal expenses cover could help with solicitor fees if a dispute with tenants goes to court.
• Gaps in tenants could increase - Rolling tenancies mean a tenant could leave with two months' notice. You should read up on unoccupancy in-case your property is ever left empty.
• Your tenancy set-up may change - If you switch to students, a house in multiple occupation (HMO), or a different tenant type, always tell your broker.

Unsure who's responsible for what? Read up on our guide to landlord vs tenant insurance obligations.

Real-world landlord examples

Landlords discussing issues may share the same worries. Sometimes these worries are about cost and other times they are worried about not understanding the small print. Here are some examples of issues you might run into and what you could do:

Landlord example 1: Paying for MTD software

"I've done my own tax returns for 20 years. Why should I now have to pay for software just to pay my tax?"

Issue - Some sole traders feel like they're 'paying to be taxed', and some landlords may share this frustration.

The reality - Unfortunately, HMRC doesn't provide its own MTD software, so you'll have to find your own software that's compatible with HMRC, there are lots of options out there and some are not too costly. You may even be able to claim the cost of this software back if you're only using it for business purposes.

Landlord example 2: Refused claims because of tenant references

"My letting agent did the tenant checks. Why was my rent guarantee claim turned down?"

Issue – Some landlords use letting agents who use their own tenant referencing system instead of using a service agreed by your insurer in policy terms. When the tenants stopped paying, the insurer rejected the claim for rent guarantee insurance.

The reality - In this case, whether or not your claim has been rejected may depend on who carries out the checks. If an agent manages your property, ask them to confirm in writing that referencing meets your policy terms. You should also check your policy terms before taking on a letting agent and ensure they meet them. If you are unsure on your policy terms, you can speak to your broker and they can explain them to you.

Landlord example 3: Do I need to fill in MTD?

"I earn £47,000 from self-employment and £4,000 in rent. Do I need MTD?"

Issue - Questions like this come up a lot on landlord forums. People often look at their rent alone.

The reality - HMRC adds self-employment and property income together, before expenses. In this example, qualifying income is £51,000. That's over the £50,000 threshold. Your salary from a job doesn't count towards it.

Tara Mitchell, Insurance Technical Manager at Bionic says - "Tax changes are a good trigger to remind you to check if your landlord insurance cover still fits your needs. For example, if you submit a record showing your property has been empty, or your tenancy set-up has changed, always tell your broker. At Bionic, we can let your insurer know about changes to your property. We can also talk you through your options if it doesn't fit."

Sorting out landlord insurance with Bionic

At Bionic, we champion UK business owners and want to help in every way we can. That's why we use a team of knowledgeable insurance brokers who work with a panel of trusted insurers to help you find cover fit for your needs.

Whether you have one buy-to-let or a growing portfolio of properties, you should consider protecting your investment. Our helpful, UK-based broker team is on hand to talk you through your options. We can help you compare residential landlord insurance and commercial landlord insurance quotes from trusted insurers.

Renewal recently gone up? Perhaps it's time to speak to a broker. Start a quote online today. We also offer cover for your business energy and broadband needs, ask our brokers about this today.

Policies vary per insurer, and limits and exclusions apply. Always check your own policy schedule to see what cover is and isn't included.

Landlord tax and insurance FAQs

Can I claim landlord insurance on my tax return?

You should be able to. Landlord insurance premiums are normally an allowable expense against your rental income. If you use MTD, you include them in your quarterly updates. If you file a standard Self Assessment return, they should go in the UK property pages (SA105).

Is Insurance Premium Tax deductible for landlords?

Yes. IPT is part of the price you pay for your policy. You claim the full amount you pay, which already includes 12% IPT. This is already included in your premium price and isn't an 'add on'.

Is Making Tax Digital software tax deductible?

It could be, if you use the software for your rental business. Check with your accountant, especially if you also use it for other income.

How much will the 2% property tax rise cost me?

As a rough guide, about 2% of your rental profit after mortgage interest. This assumes all your rental profit sits in one tax band. The Personal Allowance change could add more for some landlords. It will depend on your own personal circumstances.

Can I still claim insurance costs while my rental property is empty?

This depends how long your property has been empty. Remember to tell your insurer if your property is going to be unoccupied for a period of time. Learn about unoccupancy and business insurance.

Do the new property tax rates apply in Scotland and Wales?

The 22%, 42% and 47% rates apply in England, Wales and Northern Ireland. The Finance Act 2026 also gives the Scottish Parliament and the Senedd power to set their own property rates. Check for updates from your own government.

Do I pay tax every quarter under MTD?

No. Quarterly updates are reports, not tax payments. Your tax payment dates stay the same. Your final return is still due by January 31, after the tax year ends.

Is landlord insurance a legal requirement?

While landlord insurance isn't a legal requirement, your mortgage lender might require you to have building insurance as a condition of your buy-to-let mortgage, but you should always check your own paperwork. Remember, standard home insurance doesn't cover rental properties.

Does the Renters' Rights Act change my landlord insurance?

The Act doesn't change your policy. But it could change your risks, like how fast you can regain possession or how often a property sits empty. Always tell your broker if your tenancies change or your tenants move out. Learn more about what the Renters' Right Act means for landlords.