Making Tax Digital for Income Tax: what it means for you
The way self-employed people and landlords report income to HMRC is changing for good. Here's who's affected, when, and what you actually need to do.
Last updated 8 June 2026
What is Making Tax Digital for Income Tax?
Making Tax Digital (MTD) for Income Tax replaces the once-a-year Self Assessment return with digital record-keeping and quarterly updates sent to HMRC using compatible software. Instead of one big return in January, you'll send HMRC a summary of your income and expenses four times a year, then confirm everything with a final declaration after the year ends.
Who has to use it, and when
MTD for Income Tax is being introduced in stages, based on your gross self-employment and property income (your "qualifying income"):
- From 6 April 2026: sole traders and landlords with qualifying income over £50,000
- From April 2027: those with qualifying income over £30,000
- From April 2028: those with qualifying income over £20,000
Your income is judged on your most recent tax return — so whether you're caught from April 2026 depends on the figures in your 2024/25 return.
What you'll need to do
- Keep digital records of your business income and expenses
- Use MTD-compatible software (we'll set this up for you)
- Send HMRC a quarterly update — four times a year
- Submit a final declaration after the tax year ends, replacing the old Self Assessment return
What this means in practice
For the first wave, the first quarter runs from 6 April to 5 July 2026, with the update due by 7 August 2026. If you've always kept your books in a shoebox until January, that approach no longer works — you'll need to stay on top of your records through the year.
The good news: with the right cloud software set up properly, MTD can actually make life easier. Your records stay current, you always know roughly where you stand, and there's no January scramble.
How we help
We get clients onto modern, MTD-ready bookkeeping software, set everything up, and handle the quarterly submissions for you. You carry on running your business; we keep you compliant. If you're not sure whether MTD affects you, ask us — we'll check in minutes.
Making Tax Digital for Income Tax: what it means for you — FAQs
Do I need to use MTD for Income Tax?
If you're a sole trader or landlord with gross self-employment and property income over £50,000, you're in the first wave from 6 April 2026. The threshold drops to £30,000 from April 2027 and £20,000 from April 2028.
Will I still file a Self Assessment return?
The annual return is replaced by four quarterly updates plus a final declaration. We can handle all of these for you so it's no extra hassle.
What software do I need?
You'll need MTD-compatible software rather than a spreadsheet alone. We'll recommend and set up the right package for your business and show you the basics.
Let's sort your books out
Tell us a little about your business and we'll come back with a free, no-obligation written quote. No jargon, no pressure, just a clear price.