If you work for yourself, rent out a property or do both, Making Tax Digital for Income Tax changes how you report your income and expenses to HMRC. Your first step is to check the right self-assessment return. The figure HMRC uses may differ from the profit you took home.
Quick answer. Making Tax Digital for Income Tax requires eligible sole traders and landlords to keep digital records, send quarterly updates and file one annual tax return through compatible software. The rollout began on 6 April 2026 for qualifying income over £50,000. It extends to income over £30,000 from 6 April 2027 and over £20,000 from 6 April 2028. GOV.UK
If you want help organising tax records, working through expenses and preparing your annual return, these topics are covered in Skill Up’s UK Self Assessment Tax Return Diploma.
When Do You Need to Start Using Making Tax Digital for Income Tax?
| Self Assessment Return Used | Qualifying Income | Mandatory Start Date |
|---|---|---|
| 2024/25 | Over £50,000 | 6 April 2026 |
| 2025/26 | Over £30,000 | 6 April 2027 |
| 2026/27 | Over £20,000 | 6 April 2028 |
If you think the rules apply but you haven’t received a letter, use the HMRC eligibility checker.
What Counts as Qualifying Income?
For Making Tax Digital for Income Tax, qualifying income is generally the total you receive from self-employment and property before deducting expenses. If you run a business and let out a property, add your turnover and rental income together. PAYE wages, pensions and dividends do not count towards this threshold, although you may still need to include them on your annual return. www.gov.uk
If you own a rental property jointly, count your share of the rental income. If you’re only told what your share is after expenses have been deducted, HMRC uses that figure. GOV.UK
Example. Your 2025/26 return shows £26,000 in sole-trader turnover and £7,000 in gross rent. That gives you £33,000 in qualifying income. Because this is over £30,000, you’d start on 6 April 2027, assuming no earlier obligation or exemption applies. Your first quarterly update would be due on 7 August 2027. GOV.UK
Use the threshold to check when digital reporting starts. To work out what you might owe, see our guide to self-employed tax in the UK.
What Changes Under Making Tax Digital for Income Tax?
Keep digital records. Record your self-employment and property income and expenses in a form your software can use.
- Send quarterly updates. Each update summarises your figures from the start of the reporting year to the end of that update period. Sending it does not trigger a tax payment.
- File your annual return. Check your figures, include any other reportable income and submit the return through your software. The usual Self Assessment payment dates still apply.
- Getting ready to sign up? Find your Unique Taxpayer Reference first. Our guide on how to get a UTR number explains where to look and what to do if you’re new to Self Assessment. Yo
What Are the Making Tax Digital for Income Tax Deadlines?
For the April 2026 cohort, the quarterly deadlines are 7 August 2026, 7 November 2026, 7 February 2027 and 7 May 2027. The second standard update, for example, covers 6 April to 5 October 2026.
Keep the two January dates separate. File your 2025/26 return the usual way by 31 January 2027. If you joined Making Tax Digital for Income Tax in April 2026, file your 2026/27 return through compatible software by 31 January 2028. If you missed the November update, send it as soon as possible. HMRC does not issue penalty points for late quarterly updates in 2026/27, but you still need to submit them.
A Quick Guide to the Terms You May See Online
- When searching for Making Tax Digital in the UK, you may come across information about both Income Tax and VAT. Check which type of tax the page covers, as the rules and requirements are different.
- If you are choosing software for Making Tax Digital, make sure it supports Income Tax reporting. Some VAT software also includes features for managing Income Tax records and sending updates to HMRC, depending on the provider.
- When you come across information about a Making Tax Digital account, start by checking your existing HMRC online account or the official GOV.UK guidance to understand whether you need to sign up for the new Income Tax service.
What If HMRC Signed You Up or You Missed an Update?
If HMRC signed you up for Making Tax Digital for Income Tax, check your existing HMRC online account. From September 2026, HMRC began signing up people it had identified as needing to use the service in 2026/27 who had yet to enrol. If you searched for a “making tax digital account”, your existing HMRC sign-in is where to start.
Confirm your income sources. Check that HMRC has the right details for your sole-trader work and rental income.
- Connect your software. Follow the steps in your software to authorise it with HMRC.
- Catch up on your records. Enter the income and expenses for the periods you missed.
- Send overdue updates. Use your software to submit them as soon as possible. HMRC’s guide to catching up
HMRC does not issue penalty points for late 2026/27 quarterly updates, but you still need to send them. Late annual returns and late payments follow separate rules. From 2027/28, mandatory users can receive points for missing quarterly deadlines. Reaching four points results in a £200 penalty.
Who Is Exempt From Making Tax Digital for Income Tax?
If you think you’re exempt, start by checking whether it applies automatically or whether you need to ask HMRC.
Automatic exemption. If your qualifying income is £20,000 or less, the exemption applies automatically. You can also be exempt for a tax year if you did not have a National Insurance number before it started.
Digital exclusion. You may be able to apply if a health condition or disability prevents you from keeping digital records, or if your location means you cannot get internet access at home, at work or at a suitable alternative location. HMRC reviews applications case by case.
Some exemptions are temporary, so check when yours ends. While you’re exempt, keep filing your Self Assessment tax return as usual.
How Do You Sign Up and Choose MTD Software?
Choose compatible Making Tax Digital software before you sign up. You can use HMRC’s online service yourself or ask an authorised agent to sign up on your behalf. If you’re still sorting out your Self Assessment details, our guide on how to get a UTR number explains what to do and how long it can take.
When comparing software for Making Tax Digital, check that it handles your income sources, sends quarterly updates and supports your annual return. If you earn money from both a trade and a rental property, check that the plan covers both. You can choose an all-in-one product or connect an existing spreadsheet through compatible bridging software.
Searches such as “making tax digital uk”, “uk making tax digital” or “tax digital” can bring up guidance for both VAT and Income Tax. If you searched for “make tax digital software”, use HMRC’s finder to check that the product supports Making Tax Digital for Income Tax and the types of income you report.
How to Prepare for Making Tax Digital for Income Tax
Start with one task you can tick off today. If you already use Making Tax Digital for Income Tax, open your HMRC online account and check your next deadline. Set aside time to match your invoices and receipts to your records, then send any overdue updates through your software.
If you expect to join in April 2027, pull up your 2025/26 Self Assessment return and check your qualifying income. When comparing software, make sure it can handle the income you report, your quarterly updates and your annual return.
Wondering how much you might owe? See our guide to self-employed tax in the UK. For help sorting your records, understanding allowable expenses and preparing your annual return, see Skill Up’s UK Self Assessment Tax Return Diploma.
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