Making Tax Digital Final Declaration: The Complete Guide for Landlords

What is the Making Tax Digital Final Declaration?

The Final Declaration is the definitive annual submission under MTD that confirms your total income from all sources, applies reliefs and adjustments, and calculates your actual tax liability for the year. It is due by 31 January and replaces the old Self Assessment tax return.

The Final Declaration is the culmination of the MTD process. It works like this:

• You have submitted four quarterly updates throughout the year, reporting rental income and expenses in summary form
• You then complete an End of Period Statement for each income source, making year-end adjustments
• The Final Declaration brings everything together: property income (from the EOPS), self-employment income (from its own EOPS), plus employment income, savings income, investment income, and any other taxable income
• You also claim reliefs in the Final Declaration: pension contributions, Gift Aid donations, marriage allowance, and others
• The result is your definitive tax liability for the year

The key distinction from the quarterly updates is finality. Quarterly updates are informational and can be corrected. The Final Declaration is the submission you are declaring to be correct and complete — it is the equivalent of signing and submitting your old Self Assessment tax return.

Deadline: 31 January — the same as the old Self Assessment return. For the first MTD year (2026/27), the deadline is 31 January 2028.

The two parts of MTD year-end reporting

MTD year-end reporting has two sequential parts: the End of Period Statement (EOPS) and the Final Declaration. The EOPS must be completed before the Final Declaration can be submitted. Both are due by 31 January.

Part 1: End of Period Statement (EOPS)

The EOPS is submitted per income source. If you have rental property income, you submit an EOPS for your UK property business. If you also have a self-employment business, you submit a separate EOPS for that business.

The EOPS is where you:

• Confirm that your quarterly updates for the year are complete and accurate
• Make any property-specific adjustments that could not be made in quarterly updates
• Declare capital allowances (for commercial properties)
• Apply private use adjustments (if you use the property personally for part of the year)
• Claim Replacement Domestic Items Relief where applicable
• Declare property losses if the year has resulted in a net loss
• Apply annual expenses for jointly owned properties (if using the annual expense concession)

The EOPS is, in effect, your declaration that the figures for this particular income stream are final and correct. Think of it as signing off one chapter before the full book is completed.

Part 2: Final Declaration

The Final Declaration pulls together everything:

• Property income (from the EOPS)
• Self-employment income (from the EOPS for that business)
• Employment income (from P60/P11D, entered manually or imported)
• Savings and investment income
• Any other taxable income
• Pension contributions (for tax relief calculation)
• Gift Aid donations
• Marriage allowance elections
• Any other reliefs and allowances

The Final Declaration calculates your total taxable income, applies your personal allowance, calculates tax at the appropriate rates, applies any tax credits (including the Section 24 mortgage interest restriction credit), and produces your final tax liability. This is what you owe (or are owed, if overpaid through payments on account).

What is the End of Period Statement (EOPS) in detail?

The EOPS is a year-end summary for each income source that confirms quarterly update figures are final and adds adjustments that could not be made in quarterly reports. It must be completed before the Final Declaration.

For a landlord with UK rental property, the EOPS covers the complete UK property business for the tax year. Here is what you address at this stage:

Confirming the quarterly updates: You confirm that the four quarterly updates submitted during the year represent a complete and accurate record of the income and expenses for your property business. This is the point at which you make any corrections not already addressed in a later quarterly update.

Annual expenses not submitted quarterly: Some expenses may have been incurred but not submitted in quarterly updates — perhaps because you were using the annual expense concession for jointly owned properties, or because a bill arrived after the quarterly deadline. These are added at EOPS stage.

Capital allowances: For commercial properties or properties where capital allowances apply, you claim them in the EOPS. Residential property landlords generally cannot claim capital allowances on property purchases, but may have qualifying items (e.g. certain energy-efficient equipment).

Private use adjustments: If you personally occupied a rental property during the year — for example a furnished holiday let where you stayed yourself — a proportion of income and expenses must be excluded. This adjustment is made at EOPS, not quarterly.

Loss claims: If your property business has made a loss for the year (allowable expenses exceed rental income), you declare and claim this loss in the EOPS. Losses can be carried forward to offset future property profits.

Replacement Domestic Items Relief: If you replaced domestic items in furnished properties (furniture, appliances), you claim RDRI in the EOPS if not already included in quarterly updates.

The EOPS must be signed off before the Final Declaration is submitted. In practice, your MTD software will guide you through both stages sequentially and prevent submission of the Final Declaration until the EOPS is complete for each income source.

What goes into the MTD Final Declaration?

The Final Declaration covers all income sources for the tax year, applies reliefs and allowances, and produces the definitive tax calculation. It includes everything the old Self Assessment return covered.

Income sources included in the Final Declaration:

Reliefs and allowances claimed in the Final Declaration:

The Full MTD Year-End Timeline

The MTD year-end process runs from the end of the final quarter in April through to the 31 January deadline. Here is the complete timeline for the 2026/27 tax year.

The EOPS window opens as soon as Q4 is submitted. In practice, most landlords and accountants will complete the EOPS and Final Declaration during November, December, and January — the same period that used to be used for Self Assessment preparation.

Early filing: You can submit your EOPS and Final Declaration well before 31 January. If your affairs are straightforward and you have all the information, there is nothing stopping you from completing the year-end process in May or June. HMRC will calculate your liability and you will know exactly what you owe months ahead of the payment deadline.

How does the Final Declaration differ from the old Self Assessment return?

The Final Declaration covers the same information as the old Self Assessment return and is due by the same 31 January deadline. The difference is the process that precedes it: four quarterly updates and an EOPS replace what was previously compiled in a single annual exercise.

The key practical differences for landlords:

• No big January scramble: Because you have been reporting income quarterly, your records should be largely up to date by January. The EOPS and Final Declaration consolidate and finalise rather than compile from scratch.
• Mandatory software: The Final Declaration cannot be filed on paper under MTD. You must use HMRC-approved software.
• Agents still work the same: If you use an accountant or tax agent, they can still file on your behalf. They need to be authorised through your Government Gateway account and use MTD-compatible agent software.
• Same tax calculation: Nothing changes about how your tax is actually calculated. The rates, allowances, thresholds, and reliefs are the same — just the reporting process has changed.

Making adjustments at Final Declaration stage

Several adjustments and reliefs can only be made at the Final Declaration stage — not in quarterly updates. This is where you fine-tune your tax position for the year.

The adjustments most relevant to landlords:

Property income allowance: If your gross rental income is close to £1,000, you may elect to use the property income allowance instead of claiming actual expenses. The £1,000 allowance is deducted from gross income, and if it is greater than your actual expenses, this reduces your taxable income. The election is made in the EOPS or Final Declaration.

Losses carried forward: If your property business made a loss in a previous year and you carried it forward, you offset it against this year's profits in the EOPS. If this year has made a loss, you carry it forward for future years.

Private use adjustments: If any portion of your property income needs to be excluded due to private use (for example, a holiday let where you or family members stayed), this adjustment is made in the EOPS and flows through to the Final Declaration.

Pension contributions: Regular pension contributions made under relief at source (most personal pensions) are already basic-rate tax-relieved at source. In the Final Declaration, you declare the gross contribution to extend your basic rate band, claiming any additional higher-rate relief you are entitled to.

Gift Aid donations: Similarly, Gift Aid donations extend your basic rate band. Declare the gross Gift Aid donations in the Final Declaration to claim any higher-rate relief.

Payments on account adjustment: After the Final Declaration, HMRC calculates whether your payments on account for the following year need adjusting. If you believe your income will be significantly lower next year, you can apply to reduce your payments on account at this stage.

Tax payment under Making Tax Digital

Tax payment dates are unchanged under MTD. The balancing payment and first payment on account are due 31 January. The second payment on account is due 31 July. Quarterly updates do not trigger any tax payment.

This is one of the most commonly misunderstood aspects of MTD. Many landlords fear they will have to pay tax quarterly. They will not.

The existing payment on account system continues:

For landlords who are new to Self Assessment (and therefore new to MTD), the payment on account system works as follows: in your first year of owing more than £1,000 in tax, HMRC requires you to make advance payments towards the following year's likely tax bill — two equal instalments of 50% each. This continues each year. The system can create a significant cash flow challenge in January of your first year, as you pay the previous year's balancing payment plus the first instalment for the current year simultaneously.

Under MTD, this system continues unchanged. The quarterly update process gives HMRC a better real-time view of your income, which may lead to changes in how payments on account are calculated in future, but as of 2026 the payment structure remains as above.

Interest on late payments: HMRC charges interest on unpaid tax at the Bank of England base rate plus 2.5%. This is unchanged by MTD and applies from the day after payment was due.

What happens if you miss the Final Declaration deadline?

Missing the 31 January Final Declaration deadline carries the same immediate £100 penalty as missing the old Self Assessment deadline. Additional penalties apply at three months, six months, and twelve months. Interest accrues on any unpaid tax.

Penalty structure for late Final Declaration:

In cases of deliberate or concealed failure to file, the 12-month penalty can be up to 100% of the tax owed rather than the minimum amounts above.

The soft landing does NOT apply to the Final Declaration. HMRC's 2026/27 soft landing only covers penalties for late quarterly updates. The Final Declaration carries the full penalty structure from day one.

Reasonable excuse: If you miss the deadline due to genuinely exceptional circumstances (serious illness, bereavement, HMRC system failure), you can appeal the penalty by claiming reasonable excuse. However, "I didn't know about MTD" is unlikely to be accepted as a reasonable excuse once the 2026 mandatory date has passed.

The practical message: treat the 31 January deadline for the Final Declaration with the same seriousness as the old Self Assessment deadline. It is the same deadline, with the same consequences for missing it.

Using software to complete your Final Declaration

MTD software guides you through the complete year-end process: EOPS preparation, Final Declaration submission, and tax liability calculation. The entire process is digital and cannot be completed outside of approved software.

Here is how the year-end process looks inside MTD software:

1. Q4 quarterly update submitted. Once Q4 is submitted (by 5 May), the year's quarterly data is complete.
2. Software prompts EOPS preparation. Your software will flag that the EOPS for your UK property business is ready to be completed. You review the quarterly totals, add any adjustments, and confirm the figures are final.
3. EOPS submitted. You confirm and submit the EOPS to HMRC. If you have a self-employment business, a separate EOPS for that income is completed and submitted.
4. Software prompts Final Declaration preparation. Your software brings together all income sources: property (from EOPS), self-employment (from EOPS), and prompts you to add employment income, savings, investments, and any other taxable income.
5. Reliefs and adjustments added. You enter pension contributions, Gift Aid donations, and any other reliefs. The software applies these and shows you the tax calculation.
6. Review the tax calculation. Your software shows your total taxable income, the tax at each rate, the Section 24 mortgage interest credit, and your final tax liability. Review this carefully. If anything looks wrong, this is the point to investigate before submitting.
7. Final Declaration submitted. You click submit. The software sends the Final Declaration to HMRC through the MTD API. HMRC confirms receipt.
8. Tax calculation confirmed. HMRC confirms your tax liability. Your software will typically show the amounts due and payment dates.

LandlordOS handles the complete MTD workflow including EOPS preparation and Final Declaration submission. The software walks you through each stage, ensuring nothing is missed before you submit.