When will MTD for income tax start?
Making Tax Digital for Income Tax (MTD for income tax) will become mandatory in phases from April 2026. If you’re self-employed or have a landlord income of over £50,000, prepare for quarterly updates, digital record-keeping, and a new penalty system.
Who will MTD for income tax apply to?
Initially, MTD for income tax will apply to self-employed individuals and landlords with an annual qualifying income exceeding £50,000. From 6 April 2027, the rules will extend to those with an income between £30,000 and £50,000. A new system of penalties for late filing and late payment of tax will also be introduced.
In the Spring Statement 2025, the government confirmed that MTD for income tax will apply to sole traders and landlords with income over £20,000 starting in April 2028. The government will also explore how to treat those with income below the £20,000 threshold.
How do I know if I need to use MTD
Starting in April 2025, HMRC will begin writing to taxpayers whose 2023-24 self-assessment returns show that their total income from self-employment and property is approaching or exceeds £50,000. When your 2024-25 self-assessment is submitted, if your qualifying income is over £50,000, you will have to comply with MTD for income tax.
Signing up to MTD for income tax
Although MTD for Income tax becomes mandatory in 2026, you can opt to sign up voluntarily before then. This allows you to help HMRC test and refine the system while also familiarising yourself with the new rules. While signing up is currently voluntary, there are specific eligibility requirements, and not all taxpayers will meet these requirements. If you are eligible, you can sign up on GOV.UK.
If you volunteer to participate in testing the MTD for income tax service, the new penalties for late submissions and late payments will not apply.
How Will MTD Affect Your Tax Return Submissions?
From 2026, individuals mandated into Making Tax Digital (MTD) will no longer be able to submit tax returns via the HMRC online portal. After enrolling in MTD, you must use compatible software to file your returns. However, we will continue to submit your tax return as we always have.
We are currently assessing our clients who have been impacted by MTD and will contact you shortly. If you have any questions or would like to speak with a team member in the meantime, please don't hesitate to contact us .