When is the deadline to pay Landlord Tax?

A tax year runs from 6 April to the following 5 April and landlords need to pay tax on their profits from this period after the end of each tax year.

For example the deadline for paying your 2022/2023 tax bill through online self assessment is January 31 2024 (midnight).

The key deadline dates for landlords are:

• 5 October: register as a landlord for self assessment if you are going to submit a tax return. (This is only for your first year as a landlord.)
• 31 October: File paper version of self assessment tax return.
• 30 December: Deadline to file your online tax return if you want to pay the tax in monthly instalments through your tax code in the PAYE system.
• 31 January: Deadline for filing the online version of your self assessment tax return and deadline for paying your tax bill.
• 31 July: Second payment on account.

If you miss this payment deadline you have until 28 February to pay or you will be hit with the penalty of 5% of your total tax bill.

How do I pay my landlord tax?

You can pay the tax you owe as a landlord in one of two ways. If you are employed or receive pension income you can pay through the PAYE system.

To pay through PAYE you must owe less than £3000 on your tax bill from your rental income and unless HMRC tell you otherwise complete a self assessment tax return.

Paying the tax you owe in this way means your tax code is adjusted (to include the tax owe) with the total amount owed divided into equal monthly or weekly instalments.

Or you can pay through the self assessment system which means your tax bill is due by 31 January after the end of the tax year to which it relates.

HMRC will give you options on how to pay your self assessment tax bill which is normally paid by bank transfer through your online tax account.

Landlord second payment on account

A second payment on account is an estimation by HMRC for the upcoming year’s tax liability and is based on the previous year’s tax bill.

When you file your tax return for the previous tax year you are obligated to pay 50% of that liability towards the current year’s liability.

This means by July 31st you must make another payment of 50%. As a result by the 31 January deadline you only need to pay the remaining balance between the payments made and the actual liability amount.

In some cases this could mean you are due a tax refund all depending on your level of taxable income in comparison to the previous tax year.

If your overall tax bill is less than £1000 (excluding tax deducted from sources like PAYE) there is no requirement for you to pay a second payment on account.

If you anticipate that your liability will be lower than the previous year you have the option of asking HMRC to decrease your second payment on account.

Landlord late payment of tax penalties

For landlords who don’t pay tax owed on time the penalties are as follows:

• If the payment is 30 days overdue, a penalty of 5% will be imposed on the amount due.
• If the payment is over five months late, a penalty of 5% will be charged on the outstanding tax owed at that specific date.
• If the payment is over 11 months late, a penalty of 5% will be applied to the outstanding tax owed at that particular date.

Making tax digital for landlords

For landlords there is a phased implementation of making tax digital (MTD) for income tax self assessment (ITSA).

MTD for landlords means that digital records (using MTD compatible software) must be kept and quarterly updates submitted to HMRC detailing income and expenses.

The upcoming changes brought by MTD for ITSA will impact late payment of tax penalties as well including a new 15 day buffer to pay what you owe before penalties are applied.

From April 2026 onwards it will be mandatory for landlords with income exceeding £50,000 to participate in MTD. Starting from April 2027 the new regulations will extend their reach to those with an income surpassing £30,000.