Making Tax Digital (MTD) for Income Tax starts on 6 April 2026. That is just over five weeks away.
We wrote about who it applies to last year. This post is about what to do now if you are in the first group.
Are you in the first group?
Unless you are exempt, you must use MTD for Income Tax from 6 April 2026 if:
you are a sole trader, a landlord, or both, and
your qualifying income on your 2024/25 tax return was over £50,000
Qualifying income is your total self-employed turnover plus your property income, before expenses. Wages and pensions don't count.
If your qualifying income was between £30,000 and £50,000, your start date is likely to be April 2027, based on your 2025/26 return.
Your first year at a glance
Under MTD you send HMRC an update from your software every three months, then an MTD tax return after the year end. Each update is cumulative: it covers the year so far. These are the standard periods. If your accounts run to 31 March, you can use calendar quarters instead, starting on 1 April 2026, with the same due dates.
Update 1: 6 April to 5 July 2026, due 7 August 2026
Update 2: 6 April to 5 October 2026, due 7 November 2026
Update 3: 6 April 2026 to 5 January 2027, due 7 February 2027
Update 4: 6 April 2026 to 5 April 2027, due 7 May 2027
Your 2026/27 MTD tax return is due by 31 January 2028. Your tax payment dates don't change. HMRC has said it will not give penalty points for late quarterly updates in 2026/27, your first year. You still need to send every update.
Your 2025/26 tax return, due by 31 January 2027, is filed the usual way.
Five things to do before 6 April
Check your 2024/25 figures. Add up your self-employed turnover and rental income before expenses. If the total is over £50,000, you are in.
Choose your software. It must be on HMRC's list of MTD-compatible software. You can use one product for everything, or combine compatible products, for example one for records and updates and another for the MTD tax return. If you already use bookkeeping software, check it is MTD-ready for Income Tax.
Sign up for MTD. You or your accountant can sign you up through HMRC's online service. If we already act for you, we can do this for you.
Get your records in shape. From 6 April, your income and expenses need to be recorded digitally. A separate bank account for the business makes this much easier.
Agree who does what. Decide whether you keep the records and we send the updates, or we do both. Then put a routine in place so each quarter's records are ready on time.
Exemptions
Some people don't have to use MTD. If you can't use a computer or the internet, for example because of age, a health condition or disability, or where you live, you can apply to HMRC for an exemption. HMRC decides each case on its own facts. Partnerships are not included yet.
Summary
If your 2024/25 qualifying income was over £50,000, MTD for Income Tax applies to you from 6 April 2026. Choose your software, sign up and get your records ready now, so your first update on 7 August 2026 is straightforward.
If you would like us to get you ready for MTD, book a call or contact us.