Lots of our clients aren’t “proper landlords”. You might freelance for a living, but rent out one flat or house that brings in a bit of extra income.
If that sounds like you, here’s what actually matters going into 2026. The big theme this year is more admin, more formality, and less tolerance for “I’ll sort it at the end of the year” bookkeeping.
1) Renters’ Rights Act: what’s changing in 2026 (in plain English)
The Renters’ Rights Act 2025 is being phased in from 2026, and even “accidental” or casual landlords are affected.
From 2026 you’ll start seeing:
- More rules and paperwork for landlords
- A new private rented sector database (registration and fees)
- Greater focus on minimum property standards (the basic question becomes: is this place genuinely decent to live in?)
- Pets becoming harder to refuse (with limits on what you can charge upfront)
- Rent increases limited to once per year, with formal notice requirements
- Big tenancy changes: far fewer fixed terms, more ongoing tenancies
Gold Stag translation: being a casual landlord is getting much less casual. Even if you only rent out one property, you’re expected to operate in a more professional, regulated way.
2) New for 2026: Making Tax Digital is getting real
This is the biggest practical change for landlords with side-income.
From 6 April 2026, HMRC starts rolling out Making Tax Digital for Income Tax (MTD ITSA).
This means that some landlords will no longer just do one tax return a year.
Who does this affect?
From April 2026:
- Individuals with gross income over £50,000 from self-employment and/or property will be required to follow MTD rules.
Important: this isn’t just rental income on its own. If you freelance and rent out a property, HMRC looks at the combined total.
From later years:
- £30,000–£50,000 → planned entry from April 2027
- £20,000+ → expected from April 2028
What actually changes?
Instead of one annual scramble, MTD means:
- Digital record-keeping throughout the year
-
Quarterly updates sent to HMRC
- A final year-end declaration to confirm the totals
Even if you’re not required to join MTD yet, 2026 is the year HMRC expects landlords to start behaving this way.
Gold Stag tip: if your rental records currently live in emails, bank statements and “I’ll remember that”, April 2026 is when that approach starts to break down.
3) Can you claim tax relief for the extra costs? Usually yes… if it’s a normal running cost
HMRC’s core rule hasn’t changed:
You can usually deduct costs if they are:
- Ongoing running costs, and
- Expenses you only incur because the property is rented out
Examples that are usually deductible against rental income:
- Registration or landlord database fees
- Letting agent or property management costs (especially compliance-related)
- Safety checks, certificates and routine admin
- Day-to-day management costs
Think of these as the cost of keeping the rental business ticking over.
4) Repairs vs upgrades (still the most common trap)
This distinction matters just as much in 2026 as it ever did.
Repairs = usually deductible
If you’re fixing something to put it back how it was:
- Repainting after scuffs or wear
- Replacing broken tiles
- Repairing damage
That’s normally treated as a repair and can usually be deducted from rental income.
Improvements = not an instant deduction
If you’re upgrading the property beyond its original standard:
- A major kitchen or bathroom upgrade
- Adding something new or significantly better
That’s usually a capital improvement. Relief normally comes later (often via Capital Gains Tax calculations when the property is sold), not as an immediate expense.
Gold Stag translation: fixing = usually deductible. Fancying it up = usually not (right now).
5) Tenant damage, deposits and pets: what you can (and can’t) claim
With pets becoming harder to refuse, this question is coming up more often.
If your tenant (or their pet) causes damage:
Fixing it back to how it was
- Usually treated as a repair
- Generally deductible
Replacing items (sofa, fridge, washing machine)
- Like-for-like replacements are usually deductible
- Delivery, fitting and disposal costs normally count too
If you replace something with a much higher-spec version, the “upgrade element” may not qualify for immediate relief.
If you recover money
If you receive money back via:
- A tenant’s deposit, or
- Insurance
That amount needs to be included in the rental figures. You can’t claim a cost and ignore the reimbursement.
6) The single biggest improvement you can make in 2026: separate your rental properly 🧾🏡
This is the move that saves the most time, money and stress.
Even if your rental is only a side-earner, treat it like a mini-business:
- Keep rental paperwork separate from freelance paperwork
- Use separate folders (Google Drive, Dropbox, etc.)
- If possible, have rent paid into a separate bank account
- Pay rental expenses from that same account where you can
Why this matters:
- Mixed-up finances take longer to untangle
- Expenses are easier to miss
- HMRC enquiries are harder to deal with
- Quarterly reporting becomes painful if everything is blended together
Keep the bookkeeping simple (but consistent)
You do not need anything fancy for one or two properties. A basic system is absolutely fine the key is that it’s kept up to date.
A solid rental record includes:
- Total rental income received
- Expenses broken down, for example:
- Letting / management fees
- Insurance
- Safety certificates and compliance costs
- Repairs and maintenance
- Replacement domestic items (like-for-like)
- Mortgage interest (tracked separately from capital repayments)
- Any other property-specific costs (service charges, ground rent, etc.)
Gold Stag tip: from April onwards, think in quarters, not years. That mindset shift alone makes future reporting much easier.
Bottom line for 2026
If you’re freelancing and renting out a property:
- Landlord rules are tightening, even for small-scale landlords
- HMRC is moving firmly towards digital, regular reporting
- “I’ll sort it all at tax return time” is becoming risky
You don’t need to become a property tycoon — but you do need to start treating your rental as a proper, well-organised side business.
If you do that, 2026 is manageable. If you don’t, it’s likely to feel much more painful than it needs to be.
