The short answer, in plain words
Software that can hold your figures the way GOV.UK wants them when someone else collects the rent: the full rent the tenants paid as income, and the agent’s fee and anything else it paid out as separate expenses. The agent’s monthly statement is where those figures come from. The software is where they become digital records, and it sends the quarterly updates in your name.
Whether Making Tax Digital applies to you at all with an agent, and why it is measured on the rent before the agent’s fee, is covered in the blog post on Making Tax Digital with a letting agent, linked at the end. This page is about the software: what it has to do with an agent’s figures, who presses send, and how it works in LetCompliance.
Who does what
- You: keep the digital records and send the quarterly updates, or authorise an accountant to do it
- Your letting agent: collects the rent, takes its fee, often pays contractors from the rent, and sends you a statement showing each of those
- An accountant, if you use one: can act as your main agent with HMRC and send the updates from their own software, using the figures you or your agent provide
- Your bank: shows only the net payment from the agent, so your bank statement alone cannot give you the rent figure
The letting agent sends nothing to HMRC for you unless you have authorised it as your agent for Income Tax, which is a separate step from instructing it to manage the let.
What the software has to handle
- Gross and net in one payment. The agent pays you the rent less its fee. The software has to record the full rent as income and the fee as an expense from that one bank line, rather than take the payment as the rent
- The right expense categories. A management or letting fee belongs with legal, management and other professional fees (SA105 box 27), and a repair the agent paid for goes with repairs and maintenance (box 25)
- One property business. All your UK properties make one set of updates, even with two agents, or with some properties you manage yourself
- Your accountant’s view. If an accountant checks the figures before you send, they need to see them without your password
- The tax return as well as the updates. Check whether the product sends the final declaration too, or plan another route for the year end
One statement, entered
Take a month in which the agent collected £1,200 of rent, kept a £144 management fee, paid a plumber £90 and sent you £966. Three records go into the software, each dated and against that property:
- Rent of £1,200, as income
- The agent’s fee of £144, as a legal, management and professional fee
- The plumber’s £90, as a repair
The £966 that reached your bank is the result of those three, not a record of its own. Kept that way, your income matches what the tenant paid and your costs match what the agent spent.
Your options, compared honestly
Hand it all to an accountant. Forward the agent’s statements each quarter and the accountant keeps the records and sends the updates as your main agent. The least work for you, at the price of their quarterly fee.
A spreadsheet with bridging software. Type each statement into a spreadsheet and link it to bridging software that sends the updates. Cheap, but you are keying in every line of every statement, and the link has to stay digital.
Landlord software. Record each statement against the property it belongs to, gross, and send the updates from the same place. LetCompliance works this way, and it also runs any properties you manage yourself.
How it works in LetCompliance with a letting agent
You do not have to use the tenancy tools. Add the properties the agent manages and use Finance and the MTD page only. If you manage some properties yourself, they sit in the same account with the rent, repairs and tenancy tools as well.
Entering a statement. Record the full rent as income and the agent’s fee as an expense in the letting agent fee or management fee category, which counts in SA105 box 27, “Legal, management and other professional fees”. Repairs the agent paid go in as repairs, box 25.
From your bank statement. Import a CSV from your bank. On the line where the agent paid you, choose rent and enter the agent’s fee that was taken off: the full rent is recorded as income and the fee as a separate cost, on the same day and property. A repair the agent paid from the rent is then added as its own expense.
Sending the update. The MTD page totals the year so far for your UK property business and sends each quarterly update when you press send, never on its own. LetCompliance is recognised by HMRC for UK property income.
Your accountant. Give them a read-only link with no login, on any plan, to check the figures before you send. They cannot send updates from LetCompliance on your behalf.
What it costs. Making Tax Digital is on every paid plan: Single at £7.99 a month for one property, Solo at £14.99 for up to 3, Portfolio at £19 for up to 10, Portfolio Plus at £29 for up to 20 and Professional at £49 for any number. It is not part of the trial or the free plan.
What GOV.UK says
GOV.UK’s “Create digital records” (updated 16 October 2026, read 20 October 2026) says that if you only know your net income you should ask what the full amount of income was before expenses were deducted, then create a digital record for the full income and a separate one for the expenses. It also says you do not need separate digital records for each UK property, because all of them form one UK property business.
GOV.UK’s “Choose agents for Making Tax Digital for Income Tax” (read 20 October 2026) says you can have one main agent, who can do almost everything you can, and any number of supporting agents with narrower access. An agent asks you to authorise them through their agent services account. The guidance does not mention letting agents, so a letting agent that offers to send your updates goes through the same process as any accountant.
Common mistakes
- Assuming the agent is sending your updates because it sends you statements
- Recording the agent’s payment as the rent, which understates your income and leaves the fee unclaimed. The profit may come out the same, but the records no longer match what the tenants paid
- Leaving out repairs and certificates the agent paid from the rent, because they never appear on your bank statement
- Keeping one record per agent instead of one property business, then sending figures that do not add up
Can my letting agent submit Making Tax Digital for me?
Only if it is authorised with HMRC as your agent for Income Tax. A letting agent that offers this is acting as your tax agent, the same as an accountant, and has to ask you to authorise it through HMRC. Without that, it sends you statements and the updates stay with you or your accountant.
I have properties with two different letting agents. Do I send two updates?
No. All your UK properties are one property business, so the figures from both agents go into one set of quarterly updates.
What LetCompliance does not do here
- It does not import agent statements. Each statement is entered, or matched from your bank statement CSV
- An accountant cannot send updates for you from LetCompliance
- It covers UK property income only, not self-employment, foreign property or partnership income
- Making Tax Digital is not available on the trial or the free plan
