Overview of MTD-IT requirements from April 2026
- Effective 6 April 2026, sole traders and landlords with total income from self-employment and property over £50,000 must comply with Making Tax Digital for Income Tax, including digital record-keeping and quarterly updates to HMRC. (gov.uk)
- Gradual thresholds will de-scope or bring in more taxpayers in following years: income thresholds decrease for reporting from 2027-28 (over £30,000) and 2028-29 (over £20,000). (gov.uk)
Key components of compliance
- Use compliant software for all business and property income and expenses. (gov.uk)
- Submit quarterly updates of income and expenses using that software. (gov.uk)
- Retain digital records in line with the rules. Paper records replaceable only in limited circumstances. Do not wait until next year—April 2026 is here. (gov.uk)
Why this matters to you
- More consistent cashflow visibility for HMRC and you: less surprise tax due dates.
- Potentially higher compliance cost initially (software, training).
- Errors in records or late submissions can lead to penalties.
Practical examples
- A landlord with £60,000 rental income will need software to track all maintenance and rental receipts, update HMRC every quarter, not wait for an annual self-assessment only.
- A self-employed consultant earning £55,000 in turnover—must submit income/expense updates quarterly and maintain digital logs of invoices, expenses (fuel, home office, etc.).
- Someone with income between £30,000-£50,000: starting April 2027 will join requirement. Now is good time to prepare.
Actions to take now
- Assess whether your income reaches the threshold. If so, begin using digital record-keeping tools now.
- Select software compatible with HMRC’s MTD-IT specifications.
- Train staff or yourself on quarterly update submission process.
- Review current record retention policies: ensure digital infrastructure is secure, backed up.
- Consult a tax adviser if you have cross-border income or complicated property arrangements; compliance particularly important there.
Summary: MTD-IT is now mandatory from 6 April 2026 for those above £50,000 of qualifying income—build in processes now to meet digital, quarterly reporting; thresholds will continue to reduce over next two years.