Making Tax Digital for Income Tax: What Sole Traders and Landlords Need to Know

Making Tax Digital for Income Tax (MTD for Income Tax) changes how sole traders and landlords keep records and report to HMRC. You keep digital records, send HMRC a summary every quarter through compatible software, and then submit your tax return through the same software after the year end. It started on 6 April 2026 for people with qualifying income over £50,000. It extends to more people in April 2027 and April 2028.

HMRC looks at your qualifying income on an earlier Self Assessment return to decide when you start: | Qualifying income on your return for | Over | You must use MTD from | |---|---|---| | 2024 to 2025 | £50,000 | 6 April 2026 | | 2025 to 2026 | £30,000 | 6 April 2027 | | 2026 to 2027 | £20,000 | 6 April 2028 | **Qualifying income** is your gross income from self-employment and property added together, before expenses. A landlord with £25,000 of rent and a sole trader business turning over £30,000 has qualifying income of £55,000, even if the profit is much lower. Partnerships and limited companies are not covered by these dates. Some people can apply for an exemption, for example if they are digitally excluded. Use HMRC's [eligibility checker](https://www.gov.uk/guidance/check-if-youre-eligible-for-making-tax-digital-for-income-tax) to see where you stand.

- **Digital records.** You record business income and expenses in compatible software, or in spreadsheets connected to HMRC through bridging software. - **Quarterly updates.** Four times a year you send HMRC the totals for each income and expense category. HMRC does not see individual receipts or invoices. - **Your tax return.** After the year end you finalise your figures and submit your tax return through the same software, by 31 January as now.

Each update covers the tax year to date, not just the last three months: | Update covers | Deadline | |---|---| | 6 April to 5 July | 7 August | | 6 April to 5 October | 7 November | | 6 April to 5 January | 7 February | | 6 April to 5 April | 7 May | Because each update is cumulative, you can correct an earlier quarter in the next update without resending anything. If your records run to calendar quarters (1 April to 30 June and so on), you can choose those instead and the deadlines stay the same. See HMRC's guidance on [sending quarterly updates](https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/send-quarterly-updates).

1. **Work out your qualifying income** from your latest return, adding self-employment and property income together. 2. **Choose software** that is compatible with MTD for Income Tax, ideally the same software you use for your bookkeeping. 3. **Keep records as you go.** A quarterly deadline is much easier when receipts and income are logged each week or month rather than gathered once a year. 4. **Separate business and personal spending** where you can. A dedicated bank account linked to the software saves a lot of time. 5. **Decide who sends the updates.** You can do it yourself or authorise an accountant to submit on your behalf. 6. **Sign up** through GOV.UK if you are in scope and have not already done so. See [signing up for MTD for Income Tax](https://www.gov.uk/guidance/sign-up-your-business-for-making-tax-digital-for-income-tax).

We check whether and when you are in scope, set up your software, keep your records up to date and send the quarterly updates for you, then complete your tax return at the year end. Our [accounts and tax service](/accounts-and-tax) covers Making Tax Digital and self assessment, and our [bookkeeping service](/bookkeeping) keeps your records current so each quarter is straightforward. If you are close to the VAT threshold too, read our [VAT registration guide](/vat-registration). [Request a call](/contact) to check where you stand.