Making Tax Digital for Income Tax: Are You Affected From April 2026? A Checklist for Sole Traders and Landlords

Making Tax Digital for Income Tax Self Assessment (MTD ITSA) has been delayed and adjusted more than once, but the first mandatory phase is now live from 6 April 2026. If you're self-employed or a landlord, it's worth checking now whether — and when — it applies to you.

Who's affected, and when

MTD ITSA is being phased in by income level. Self-employed people and landlords with qualifying income over £50,000 must comply from April 2026. Those with qualifying income over £30,000 join from April 2027, and anyone over £20,000 joins from April 2028. Your "qualifying income" is your gross turnover from self-employment and property combined, before expenses — not your profit.

What actually changes

Rather than filing one annual Self Assessment return, MTD ITSA requires quarterly digital updates submitted through compatible software, followed by a final year-end declaration. You'll need to keep digital records throughout the year rather than gathering receipts at the last minute in January.

The good news for this year's cohort

The government has confirmed that taxpayers joining MTD ITSA in April 2026 won't receive penalty points for late submission of their first four quarterly updates — a grace period that only applies to this first cohort, not to those joining in 2027 or 2028. There's also separate news this month that HMRC's MTD sign-up services will be down from 5pm Friday 10 July to 9am Monday 13 July for system maintenance, so avoid leaving registration to that weekend.

Checklist: getting ready for MTD ITSA

• Add up your gross self-employment and property income for the last tax year to see which threshold band you fall into.
• If you're over £50,000, you should already be either compliant or in a testing period — check with your accountant if you haven't started.
• Choose HMRC-recognised MTD-compatible software — a spreadsheet alone won't qualify unless it's linked to bridging software.
• Set up a habit of recording income and expenses digitally as they happen, rather than batching everything at year-end.
• Diarise your quarterly submission dates rather than relying only on the old January deadline.
• If your income is close to a threshold, plan ahead — a good year could tip you into an earlier mandatory phase.

How this compares internationally

Digital, more-frequent tax reporting for the self-employed isn't unique to the UK. Australia's Single Touch Payroll requires real-time digital reporting for employers, and the US IRS has been steadily expanding digital 1099 reporting requirements for gig economy platforms. The UK's shift to quarterly self-employed reporting is arguably a bigger structural change than either, since it replaces an annual return model that had been in place for decades.

Key Numbers

• £50,000 — qualifying income threshold for the April 2026 MTD ITSA phase
• £30,000 — threshold for the April 2027 phase
• £20,000 — threshold for the April 2028 phase
• 4 — quarterly updates exempt from penalty points for the 2026 cohort

Sources

• GOV.UK: Find out if and when you need to use Making Tax Digital for Income Tax
• GoCardless: Making Tax Digital explained
• Tax Journal: HMRC manual changes, 3 July 2026
• Meacher-Jones: Tax e-News July 2026

Educational content only — not financial advice.