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Setting Up and Submitting Foreign Property MTD ITSA Quarterly Returns in BrightBooks

Shannon Brady
  • Updated

Setting Up and Submitting Foreign Property MTD ITSA Quarterly Returns in BrightBooks

1. What is a foreign property business?

Foreign property business income includes:

  • Rental income from properties located overseas, where that income is taxable in the UK
  • Typically reported separately from UK property income in Self Assessment
 

Under MTD, foreign property income needs its own digital records and quarterly updates once the client is within scope .

 

2. Setting up a foreign property business in BrightBooks

  1. In MTD ITSA settings for the client, add a new Foreign property income source.

  2. Configure:

    • Business name/description (e.g. “Jones – Foreign Property Business”)
    • Ownership share
    • Accounting method (Cash or Accruals)
    • Quarterly Period Type (Standard or Calendar)
     
  3. Save the setup.
 

3. Recording foreign property income and expenses

  • Convert overseas rental income and expenses into GBP using appropriate exchange rates before entering.
  • Record:
    • Rental income (by property or as totals)
    • Allowable expenses (repairs, management fees, insurance, relevant local taxes, etc.)
 

BrightBooks expects GBP values; exchange rate policy and calculations should be documented outside the system in line with HMRC guidance.

 

4. Quarterly updates for foreign property

Foreign property income normally requires a separate quarterly update from:

  • Self‑employment
  • UK property
 

The quarterly update includes:

  • Total foreign property rental income
  • Total allowable foreign property expenses
 

5. Creating and submitting the quarterly return

  1. Go to General Ledger → MTD ITSA, select the foreign property source.
  2. Identify the open quarter and click Generate.
  3. Review the aggregated figures and Save.
  4. Optionally print the report, then Submit to HMRC as usual.
  5. Monitor status until Fulfilled.
 

6. Year‑end interaction

Any detailed exchange rate adjustments, foreign tax credits or double tax relief will be handled at year end in your tax software. BrightBooks’ role is to ensure accurate digital records and correct quarterly summaries are sent.

 

For more background and resources on MTD for Income Tax, see Bright’s MTD hub by clicking here.