If you’re self-employed or a landlord and your turnover is over £50,000, Making Tax Digital for Income Tax is no longer something on the horizon. It’s here. From April 2026, you’re required to keep digital records and submit quarterly updates to HMRC – and the new tax year has just started.
If you haven’t got anything in place yet, now is the time to sort it. The good news is that it’s more straightforward than it sounds, and we can help you get set up without the stress.
What is Making Tax Digital for Income Tax?
Making Tax Digital (MTD) is HMRC’s programme to modernise the UK tax system. For Income Tax Self Assessment (ITSA), it means replacing the traditional annual tax return with a new approach built around digital record-keeping and regular reporting.
In practice, that means two things.
- You’ll need to keep your business records digitally using HMRC-compatible software.
- You’ll need to submit a summary of your income and expenses to HMRC every quarter, with a final declaration at the end of the year to confirm everything is accurate.
The annual tax return you’re used to is effectively being replaced. Quarterly updates take their place, with a shorter end-of-year wrap-up rather than the full return process.
Who does this apply to right now?
From April 2026, MTD for Income Tax applies to sole traders and landlords with qualifying income over £50,000. If your income from self-employment or property, or a combination of the two, exceeds that threshold, you need to be compliant from this tax year.
The rollout continues beyond that.
- From April 2027, the threshold drops to £30,000
- From April 2028 it drops again to £20,000.
If you’re not affected yet, it’s still worth getting organised now – the changes are coming regardless.
What do you need to get in place?
The most important first step is getting the right software. HMRC requires you to use MTD-compatible software to keep your records and submit your quarterly updates – you can’t do it through HMRC’s own portal or a spreadsheet alone.
There are several good options on the market, and the right one for you will depend on how comfortable you are with technology, how complex your finances are, and how hands-on you want to be.
We work with a range of MTD-compatible software and can recommend the best fit for your situation, as well as providing training so you’re confident using it from day one.
The quarterly update process
Once you’re set up, here’s what the year looks like under MTD.
- Your business income and expenses are recorded digitally throughout the year
- At the end of each quarter, a summary is submitted to HMRC
- At the end of the tax year, you complete a final declaration to confirm your figures and settle any tax owed.
The quarterly updates themselves are summaries – they’re not full tax returns. Think of them as regular check-ins rather than four times the admin. Done right, with the right software, it becomes part of your routine rather than a chore.
How we can help
We offer different levels of support depending on how involved you want to be. Some of our clients prefer us to handle everything, from setting up their digital records through to submitting all four quarterly updates and the final declaration. Others are happy to manage their day-to-day bookkeeping themselves and just want us to review and submit on their behalf. And some just want us to get them set up properly and check in at year end.
Whatever suits you, we’ll make it work. The important thing is that you have the right system in place from the start, so you’re not scrambling to catch up later in the year.
Don’t leave it too long
The first quarterly submission deadline for the 2026/27 tax year will arrive sooner than you think. Getting your software chosen, set up, and working properly takes a little time, and it’s much easier to do that calmly now than in a rush before a deadline.
If you’re not sure whether MTD applies to you, or you want to talk through your options, get in touch. We’ll give you a straight answer and help you figure out the best approach for your business.
Find out more about our MTD services or contact us, to arrange a no-obligation call.
