UK tax and accounts basics, explained

Making Tax Digital for Income Tax: Who Needs It and When

8 November 2026

General information, not tax adviceEvery figure here is quoted from GOV.UK, with the tax year it applies to. Your own position can differ, so check your HMRC online account and the linked GOV.UK page, or speak to a qualified accountant.

Making Tax Digital for Income Tax changes how some sole traders and landlords report their income to HMRC. This guide sets out who needs it and when, using GOV.UK's own figures and dates, with a link to each GOV.UK page. It's general information, not tax advice.

Key Takeaways

• It applies to sole traders and landlords registered for Self Assessment whose qualifying income is over the threshold.

• Qualifying income is your total income from self-employment and property, before expenses.

• You send quarterly updates through compatible software, with deadlines of 7 August, 7 November, 7 February and 7 May.

• HMRC won't apply penalty points for late quarterly updates during the 2026 to 2027 tax year.

• You still submit a tax return by 31 January following the end of the tax year.

Who needs to use it

GOV.UK's page Find out if and when you need to use Making Tax Digital for Income Tax says you need to use it if all of the following apply:

• you're a sole trader or a landlord registered for Self Assessment

• you get income from self-employment or property, or both

• your qualifying income is more than the relevant threshold for the tax year

GOV.UK says partnerships will also need to use it in the future, and HMRC will set out that timeline at a later date.

The start dates and thresholds

When you need to start depends on your qualifying income in a given tax year:

GOV.UK's sign-up page explains that qualifying income is your total income from self-employment and property, before expenses (also known as turnover), based on the tax return you submitted the year before.

How HMRC checks whether it applies to you

GOV.UK says HMRC reviews your Self Assessment tax return and checks your qualifying income each tax year. If it's above the threshold, HMRC will write to you to confirm that you need to start using Making Tax Digital for Income Tax by the start of the following tax year.

GOV.UK adds that if you don't get a letter, it's still your responsibility to check if and when you need to use it. GOV.UK also says that from September 2026, HMRC will start to sign up anyone who needs to use it for the 2026 to 2027 tax year and hasn't signed themselves up.

Signing up

To sign up, GOV.UK says you must be registered for Self Assessment and have submitted a tax return in the last 2 years. You still need to submit a Self Assessment tax return for the tax year before you start. If you aren't registered yet, our guide on how to register as self-employed in the UK explains how.

You can also sign up voluntarily before you need to, for the current tax year or the next one. If you use an agent, they can sign you up instead.

Quarterly updates

Once you're using it, you keep digital records and send quarterly updates through software that works with Making Tax Digital for Income Tax. GOV.UK's page on sending quarterly updates describes them as summaries, not tax returns. Each one covers the tax year so far, from 6 April to the end of the update period.

If your accounting period runs from 1 April to 31 March, GOV.UK says you should use calendar update periods instead. The deadlines are the same. If you have no income or expenses in an update period, you must still send the update.

Penalties

GOV.UK says HMRC won't apply penalty points for late quarterly updates during the 2026 to 2027 tax year. After that year, a late quarterly update gets a late submission penalty point, and reaching 4 points means a £200 penalty. Penalty points also apply to late tax returns.

The tax return still matters

You still submit a tax return. GOV.UK's page on submitting your tax return says it's due by 31 January following the end of the relevant tax year, and you can submit it earlier.

Our guide to Self Assessment tax return deadlines covers the current dates.

Digital records still use the same income and expense categories as Self Assessment, so it helps to know what counts. Our guide to allowable expenses for the self-employed sets out what GOV.UK says you can claim.

If you can't use digital tools

GOV.UK says some people may be exempt, for example if they're digitally excluded. If you're not automatically exempt, you apply to HMRC. GOV.UK's page on applying for an exemption explains how. If you're exempt, you must still report your income in a Self Assessment tax return.

For all the key dates on one page, see our summary of key tax dates and thresholds.

Frequently asked questions

When does Making Tax Digital for Income Tax start?

GOV.UK says it started on 6 April 2026 for sole traders and landlords with qualifying income over £50,000 in the 2024 to 2025 tax year. It starts on 6 April 2027 for qualifying income over £30,000 in 2025 to 2026, and on 6 April 2028 for over £20,000 in 2026 to 2027.

Is qualifying income my profit?

No. GOV.UK says qualifying income is your total income from self-employment and property before expenses, also known as turnover.

Are there penalties for late quarterly updates in the first year?

GOV.UK says HMRC won't apply penalty points for late quarterly updates during the 2026 to 2027 tax year. Penalties still apply for late tax returns and late payment.

Do partnerships need to use Making Tax Digital for Income Tax?

Not yet. GOV.UK says partnerships will need to use it in the future, and HMRC will set out the timeline at a later date.

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