MTD from April 2026
Income tax
HMRC first announced more than a decade ago that they planned to move some Self Assessment taxpayers to making quarterly returns of information, via a different platform. This has been postponed many times, but is finally with us.
Making Tax Digital (MTD) is a new system for sending HMRC information relevant to income tax and national insurance – some of the main information that currently goes into your tax return. This involves making quarterly submissions to HMRC, called quarterly updates, and then a final submission which brings the whole year’s information together. These need to be done via different software to the current tax-return form.
There is no change to dates for payment of tax at this time.
And no change to how the next (2025/26) tax return will be prepared – that will be a single tax return in the usual format.
Enrolment into MTD from April 2026 is compulsory for taxpayers with self-employed and/or rental property income (turnover) totalling £50,000 or more in the 2025 return. HMRC calls this income ‘qualifying income’ and it is calculated before any expenses have been deducted. Partnership, salary and investment income do not count towards MTD qualifying income.
If you would like to check whether you need to enter MTD based on your qualifying income in the 2024/25 return, you can do so here:
Why do you need to send a Self Assessment tax return? – Guidance – GOV.UK
Based on current rules, it is compulsory to enter MTD when total qualifying income reaches the following thresholds:
- £50,000 in the 2024/25 return: enrol from April 2026 with the the first quarterly update due by 7 August 2026
- £30,000 in the 2025/26 return: enrol from April 2027 with the the first quarterly update due by 7 August 2027
- £20,000 in the 2026/27 return: enrol from April 2028 with the the first quarterly update due by 7 August 2028
In very limited circumstances, HMRC grants exemption from MTD to a taxpayer who they agree is ‘digitally excluded’. There is more information about this here.
Making Tax Digital for Income Tax – GOV.UK
VAT
VAT is already on a digital system (since 2019). VAT-return information goes to HMRC via a spreadsheet with ‘bridging software’, or direct from a bookkeeping software package.
