Does MTD apply to me?
Making Tax Digital for Income Tax started in April 2026. Answer two questions and see exactly where you stand — including whether you are outside it altogether.
Does MTD apply to you?
Two questions. Instant verdict with your exact deadlines — no email wall.
Thresholds per HMRC: £50k from Apr 2026 · £30k from Apr 2027 · £20k from Apr 2028.
Making Tax Digital for Income Tax is the biggest change to Self Assessment since Self Assessment itself. Instead of one annual return, affected sole traders and landlords keep digital records and send HMRC cumulative summaries four times a year, then finish with a Final Declaration. The obligation arrived on 6 April 2026 for those with qualifying income above £50,000 — and industry research keeps finding that most affected people still do not know what it requires.
The thresholds, in order
- April 2026 — qualifying income over £50,000, based on your 2024–25 return.
- April 2027 — the threshold drops to £30,000.
- April 2028 — it drops again to £20,000.
- Below £20,000 — outside MTD for Income Tax. Nothing changes: you carry on filing one Self Assessment return a year, as now.
- Qualifying income is gross self-employment plus property income, added together, before expenses.
The quarterly deadlines
Updates are due by 7 August, 7 November, 7 February and 7 May. They are cumulative year-to-date summaries rather than four separate snapshots, and a sole trader who also lets property files two updates each quarter — one per income stream.
Penalties
Late quarterly updates earn penalty points, and accumulated points convert into £200 fines. HMRC confirmed a softer first year for those joining in April 2026, but that leniency does not extend to the Final Declaration or to paying the tax itself.
MTD questions
What counts as qualifying income?
Gross self-employment turnover plus gross property income, combined, before deducting expenses. Employment income and dividends do not count towards the threshold.
I am just under the threshold. Do I need to do anything?
Not yet. But check the year below yours: the threshold drops to £30,000 from April 2027 and to £20,000 from April 2028, so an income that is outside today can be inside within two years. Below £20,000 of qualifying income you stay outside MTD altogether and continue with Self Assessment as now.
Can I still use a spreadsheet?
Only with bridging software that connects it to HMRC. A spreadsheet alone no longer satisfies the digital record-keeping requirement.
Does the Final Declaration replace my tax return?
Yes. The quarterly updates report raw income and expenses; the Final Declaration adds reliefs, allowances and other income, and calculates what you owe.
What if my income drops below the threshold later?
HMRC has set out a process for leaving MTD when qualifying income falls, but you stay in until that is confirmed — you cannot simply stop filing.