The Three Line Accounts Easement
Separately from the joint-property easement, if your UK property turnover is below the VAT registration threshold (£90,000), HMRC allows simpler income-and-expense categorisation — often called three-line accounts.
Instead of breaking expenses into many property categories, you can record and submit simpler totals for that tax year.
Residential finance costs are still separate
Mortgage interest and other residential finance costs must still be identified separately. Relief is restricted to the basic rate of Income Tax, so HMRC requires them to be split out even when you use simplified categorisation.
If turnover reaches £90,000
You must categorise all digital records for that income source in full from the start of the tax year — including records from earlier in the year. If you are unsure whether turnover will reach £90,000, HMRC advises keeping fuller categories from day one.
Software support required
Your software must support simplified totals and separate finance-cost reporting. Check with your provider.
Related Articles
Was this article helpful?
Ready to comply with MTD?
Abridge makes it easy to submit your spreadsheet to HMRC.