Many landlords already have a spreadsheet they understand. Rent goes into one column, repairs into another, and the figures are there when the tax return needs attention. Making Tax Digital does not automatically make that spreadsheet useless, but it does change what has to happen around it.
The choice is now between keeping the spreadsheet as part of an MTD setup or moving the records into MTD software for landlords that also handles submissions. Both routes can work. The comparison comes down to cost, how records move between systems, the work involved at quarterly filing time and what happens when the tax return is due.
Record keeping setup
A spreadsheet can continue to hold digital records under Making Tax Digital. The limitation is that the spreadsheet itself does not send quarterly updates or the tax return to HMRC. It needs compatible software that connects to those records and handles the submission. HMRC refers to products used this way as bridging software.
That leaves landlords with a choice. They can keep the spreadsheet and add compatible software around it, or move the rental records into a product that handles both record keeping and filing.
For a landlord with one UK property who wants digital records and quarterly updates handled within the same system, Quarterwise is an HMRC-recognised software option with a permanently free one-property tier. Where property is the only income source to report, the same product can also submit the tax return. The free plan is not a temporary trial.
The decision is less about whether spreadsheets are allowed and more about how many separate parts the landlord wants to manage.
The main difference is how records reach HMRC
With a spreadsheet setup, the spreadsheet remains the record. Compatible software then connects those records to HMRC when a submission is due. Where information moves between products used for MTD records, HMRC requires that transfer to remain digital rather than relying on manual copying between systems.
Dedicated software removes that handoff when the same product stores the records and sends the submission. Rent and property expenses are entered or imported into the software, then the quarterly figures are produced from those records.
Neither route changes what HMRC expects to receive. The practical difference sits with the landlord, who either maintains a connection between separate tools or keeps the records and filing process inside one product.
A landlord with a spreadsheet that has worked well for years may see little reason to replace it. Someone who dislikes moving data between tools may prefer the second setup.
The cheaper route depends on the full setup
A spreadsheet may already cost nothing, but the price of the spreadsheet is only one part of the MTD setup. Compatible bridging software is still needed to send information to HMRC. HMRC lists both free and paid software choices, so software costs vary across MTD setups.
Dedicated software also comes in free and paid forms. The cost depends on what the landlord needs from the product, how many properties are involved and whether extra functions sit behind a paid tier.
For a landlord with a single property, a permanent free plan can remove much of the price difference between the two routes. For a larger portfolio, the comparison may change once property limits or paid features come into play.
Cost does not produce one winner in every case. A landlord already using a spreadsheet and compatible filing software needs to compare the cost of keeping that setup with moving to a dedicated product. For a landlord with one property, a permanently free dedicated tier can also keep software costs at ยฃ0. The deciding factor is the cost of the whole setup rather than the spreadsheet alone.
Work involved at quarterly update time
MTD quarterly updates are summaries produced from the digital records kept during the year. They are not separate tax returns. Each update covers the records from the start of the tax year to the end of the relevant update period.
For spreadsheet users, this makes record keeping between deadlines more visible. The sheet needs to stay accurate, and the route from the spreadsheet into the filing software needs to work when an update is due.
A dedicated product keeps those stages closer together because the records used for the update already sit inside the filing software. That does not remove the need to check the records and correct any errors before they feed into later submissions.
The difference is mainly administrative. Dedicated software has the edge for landlords who want fewer separate steps at quarterly update time. A landlord who is comfortable maintaining a spreadsheet and its digital connection to filing software may have little reason to change on this factor alone.
The tax return matters as well as the quarterly updates
Quarterly updates are only part of Making Tax Digital for Income Tax. Landlords within MTD still need to submit their tax return after the tax year ends, so software choice should account for that stage as well. HMRC’s software finder asks landlords about quarterly updates, digital records and tax return needs when identifying suitable products.
Some bridging products can handle quarterly updates and the tax return. Others may form only one part of a landlord’s setup. The same variation exists among products that create digital records, so the functions included matter more than the label attached to the software.
This can be relevant for landlords who already work with an accountant. A spreadsheet may fit an existing handover process, while another landlord may prefer the records and tax return to stay within the same software used during the year.
Neither arrangement is automatically wrong. The useful question is how many separate transfers, checks and products the landlord wants to manage before the year is finished.
Familiarity and existing workflow
Spreadsheets remain workable under MTD when the records are kept digitally and connected to compatible filing software. For landlords who know their spreadsheet well and are comfortable maintaining that setup, moving every record into a new product may offer little benefit.
Dedicated MTD software has a clearer advantage when the landlord wants digital records, quarterly updates and the tax return handled within one system. It removes the need to maintain a separate bridging step, although the exact functions and price still depend on the product chosen.
A spreadsheet setup is likely to suit landlords who already keep accurate records that way and are comfortable using separate compatible software for filing. Dedicated MTD software is more suited to landlords who prefer digital records, quarterly updates and the tax return to stay within the same system.
Neither option is better for every landlord. The choice depends on whether familiarity with an existing spreadsheet matters more than reducing the number of separate steps involved in MTD filing.
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