Landlords have faced a number of challenges in recent years, including a hike to stamp duty payable on second homes from 3% to 5% and higher mortgage rates.
Other regulatory changes have further impacted the buy-to-let market.
The introduction of Section 24, which was phased in between 2017 and 2020, means landlords now have to pay tax on their full rental income before finance costs are deducted, leading to much higher tax bills for some.
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Stagnating house prices have meant smaller profits too, particularly for landlords in London where property prices have plummeted in parts.
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Further changes are set to come into force in 2026 and beyond, including the rollout of Making Tax Digital for Income Tax, the Renters’ Rights Act and a new Energy Performance Certificate regime. Landlords need to prepare themselves for the changes.
Tim Thomas, policy and campaigns officer at Propertymark, a trade body for estate agents, said: “The operational landscape for many landlords is one of mass evolution as we head further into the year.
“For landlords it will represent some of the biggest changes in well over 30 years and it is essential there is proactive planning to ensure compliance on new rules.”
Here’s everything you need to know ahead of the changes coming into force.
Making Tax Digital for Income Tax - from 6 April, 2026
Making Tax Digital for Income Tax is being rolled out from 6 April 2026 for landlords with annual rental incomes over £50,000.
You will have to report your income and expenses to HMRC digitally on a quarterly basis.
Landlords earning between £30,000 and £50,000 will have to do this from April 2027 while individuals with income between £20,000 and £30,000 will need to follow the new rules from April 2028.
More than 860,000 self-employed people and landlords will have to start reporting their income and expenses through the new digital process from April 2026.
The change is part of the government’s efforts to modernise the tax system and ensure the information provided by taxpayers is more accurate.
Thomas, from Propertymark, said: “Over time, this methodology will ultimately supersede traditional paper or online self-assessment returns and will be implemented for everyone in phases, depending on turnover and as time progresses.”
Landlords will need to make sure they’re compliant with the new rules as penalties will apply to those that aren’t.
A penalty point is issued for a late quarterly update or return with a £200 penalty charged if you reach four points within two years.
You will need to report your income and expenses through compatible software. HMRC has a software finder tool you can use to find software that will work.
Renters’ Rights Act - 1 May, 2026
The Renters’ Rights Act is one of the Labour government’s landmark pieces of legislation but has faced criticism from landlords – yet, it’s still worth understanding how it will affect you.
The Act passed in October 2025, with the first major reforms on evictions and tenancies taking effect on 1 May 2026.
From 1 May, the following changes will kick in:
- End of ‘no-fault’ (Section 21) evictions – landlords in the private rented sector won’t be able to evict tenants without a valid reason.
- Fixed contracts abolished – all tenancies in the private rented sector will roll on from month to month or week to week (depending on the arrangement you have with a tenant) with no end date. Tenants can also end them with two months’ notice.
- New rental rules – landlords can only raise rent once a year, while renters will have the power to challenge unjustified hikes.
- No more bidding wars – landlords must stick to no more than the advertised rent price.
- One month’s rent upfront, max – landlords can’t ask for more than one month’s rent upfront.
- Refusing tenancy to those on benefits or with children abolished – it’ll be illegal to refuse tenants just because they receive benefits or have kids.
- Pets policy – renters will be able to ask to live with a pet and any requests can’t be “unreasonable refused” by landlords.
Other aspects of the Renters’ Rights Act will kick in from late 2026, including the introduction of a Private Landlord Ombudsman renters will be able to take complaints to.
A Private Rented Sector Database will also be rolled out so renters can check if you as a landlord are registered.
After this, Awaab’s Law, which makes it incumbent on landlords to address all emergency hazards like damp and mould, and already applies to the social rented sector, will be applied to the private renter sector following a consultation.
The National Residential Landlords Association, a trade association for landlords, has issued guidance on its website of what landlords can do ahead of the changes being implemented as part of the Renters’ Rights Act.
This includes inspecting your properties and addressing any potential hazards, doing checks on prospective tenants and ensuring your letting agent, if you use one, is ready for the changes.
It’s crucial you follow the new rules when they come into force – initial or minor non-compliance will incur a civil penalty of up to £7,000 and serious, persistent or repeat non-compliance a civil penalty of up to £40,000, with the alternative of a criminal prosecution.
New Energy Performance Certificate metrics - second half of 2027
Landlords must ensure all private rental properties have an EPC rating of C or above by 2030 under the Minimum Energy Efficiency Standard (MEES), up from E currently.
However, under a new system via the Home Energy Model landlords will have to meet two metrics out of a possible three to meet the C rating, rather than one.
Landlords will have to meet a “fabric performance” standard through installing measures like loft insulation, cavity wall insulation or double glazing.
They will then have to meet either a “heating systems” or “smart readiness” metric. The heating systems metric will mean landlords having to install measures like heat pumps while the smart readiness metric would see landlords getting solar panels installed.
You could face spending thousands to reach the new C standard.
The new metric system was due to be launched in October 2026, but ministers have now pushed this back to the second half of 2027.
This means what classes as an EPC rating of C now might change in the future.
If one of your rentals has an EPC of D or lower, you should take steps now to ensure they meet the current C rating so you’re more likely to pass the new EPC ratings.
Adding insulation to your loft or cavity walls, upgrading to LED lighting across your home and installing a smart thermostat can all boost the EPC rating of your home.
You might also be able to get a grant of up to £7,500 toward the cost and installation of a heat pump through the Boiler Upgrade Scheme, which has been extended to 2030.
Thomas, from Propertymark, said: “Given the current shortage of skilled tradespeople and the high volume of properties requiring upgrades, addressing these environmental improvements now is essential.”
Minimum qualifications for letting agents - date to be confirmed
In 2025, the government laid out plans to increase regulation among estate agents, namely by introducing mandatory qualifications for letting agents.
Ministers also laid out proposals to implement a Code of Practice setting out a minimum standard property agents, including estate, letting and managing agents, have to meet.
No date has yet been set on when these new rules would come into effect, with a consultation having closed and the government considering next steps.
Ahead of any changes coming in, landlords using letting agents should ensure they hold correct qualifications.
If not, you may want to switch to a different company that is ready for the upcoming law changes.
