Compliance
Navigating Making Tax Digital from April 2026: A Guide for UK Self-Employed and Landlords
From 6 April 2026, digital record-keeping and quarterly updates become mandatory for many sole traders and landlords — here’s what you must know to stay compliant.
By NomadicTax Research Team • 5-8 min read • April 7, 2026
## What is Making Tax Digital (MTD) for Income Tax Self Assessment?
Starting **6 April 2026**, businesses, self-employed individuals and landlords whose **qualifying income** (from trading and property) **exceeds £50,000** will be required to operate under MTD rules. Those whose income exceeds £30,000 will have to join from **6 April 2027**.([gov.uk](https://www.gov.uk/government/publications/extension-of-making-tax-digital-for-income-tax-self-assessment-to-sole-traders-and-landlords/making-tax-digital-for-income-tax-self-assessment-for-sole-traders-and-landlords?utm_source=openai))
Under MTD, affected taxpayers will need to:
- keep **records digitally** using compatible software;
- send **digital quarterly updates** to HM Revenue & Customs (HMRC);
- submit the annual Income Tax Self-Assessment return via software.([gov.uk](https://www.gov.uk/government/publications/extension-of-making-tax-digital-for-income-tax-self-assessment-to-sole-traders-and-landlords/making-tax-digital-for-income-tax-self-assessment-for-sole-traders-and-landlords?utm_source=openai))
## Why this matters now
- Many landlords/sole traders under the old Self Assessment model will need to upgrade their systems, software and processes before the deadline.\
- Failure to comply can lead to penalties, especially after transitional grace periods.\
- Digital accounting can open up better tax planning opportunities and real-time financial visibility.
## Action steps you should take
| Step | What you should do | Timeline / Example |
|---|----------------------|----------------------|
| 1 | Determine if your qualifying trading + property income exceeds **£50,000** (for 2025-26) | Based on your last tax return; if it exceeds, you’re in scope from 6 April 2026. |
| 2 | Choose software that’s HMRC-compatible | Use the list on gov.uk to check approved software. |
| 3 | Digitize your records — invoices, expenses, property income, etc. | Early 2026 gives you buffer. |
| 4 | Plan quarterly updates: which dates, what to report, who handles it | For many, these will be in **August, November, February and May**. |
| 5 | Seek professional advice if you have complex situations (e.g. non-UK income, trusts) | Ensures all corners of your tax obligations are covered. |
## Example scenario
Sarah is a landlord whose gross property rental income is £30,000 and runs a side business earning £25,000 a year. Her **qualifying income** (property + trading) is thus £55,000. From 6 April 2026, Sarah must use MTD: maintain digital records, file quarterly updates, and submit her annual Self Assessment via software. If she misses the annual-return deadline through the previous paper/portal route, HMRC may refuse her annual return unless she is compliant.
## Common pitfalls to avoid
- Relying on spreadsheets that are not “compatible software” under HMRC’s rules.\
- Waiting until close to the deadline to find or train with software—errors can be costly.\
- Overlooking property income that needs to be included in “qualifying income.”\
- Assuming exemptions—there are defined thresholds, not blanket exclusions.
## Conclusion
The shift toward Making Tax Digital for sole traders and landlords with over £50,000 qualifying income is a **major compliance milestone**. Acting early—selecting the right software, digitizing your records, understanding your reporting timeline—can make the transition smooth. For those nearing the thresholds, keeping a close eye on income projections is crucial. With proper planning, MTD can deliver efficiency and clarity in your tax affairs.