MAKING TAX DIGITAL FOR INCOME TAX

 

Under MTD for tax, businesses, self-employed people and landlords will be required:

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• To operate MTD for tax from 6 April 2026 in relation to their trading AND property income when  their gross sales/turnover from these income sources combined for a tax year exceeds £50,000 (£30,000 from 6 April 2027 & £20,000 from 6 April 2028)

• To keep their records digitally to produce digital quarterly updates and provide them to HMRC through MTD for tax compatible software

• UK residents will have to follow MTD for tax if they have foreign property income that meets the threshold (may be combined with other self-employment or UK property turnovers). 

• Digital records of all transactions will be needed. These will form the basis of the quarterly updates submissions.

• If you are not already using software for your record-keeping/accounting, you will need to learn how to use a spreadsheet or some type of accounting software or App which is MTD for tax compliant.

 

General partnerships will not be required to join the project until later.

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More complex partnerships will be required to join MTD for tax at a future date to be confirmed.

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New businesses will be required to join MTD for tax from the April after they file their first self assessment tax return.

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Those within scope of MTD for tax you will need to keep digital records and use software to provide HMRC with quarterly updates. Everyone will file to the same quarter dates irrespective of their accounting period, i.e. quarters to 5 April, July, October and January with an option to elect to report to 31 March, 30 June, 30 September and 31 December.

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An End of Period Statement will be required to finalise the reporting, equivalent to the self-employment and property pages of the self assessment tax return.

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MTD for Income Tax reporting requirements:

 

• Quarterly updates must be submitted to HMRC, with everyone adhering to the following quarter dates:

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