Making Tax Digital for Income Tax: Are You In, and From When?

Making Tax Digital (MTD) for Income Tax is no longer a future change to plan for — it is now live for the first group of self-employed people and landlords. If you have not checked whether it applies to you yet, here is exactly who is in, and when the next groups join.

Key takeaways

• MTD for Income Tax became mandatory from 6 April 2026 for qualifying income over £50,000 (based on 2024/25 income).
• The threshold drops to £30,000 from 6 April 2027 (based on 2025/26 income).
• It drops again to £20,000 from 6 April 2028 (based on 2026/27 income).
• "Qualifying income" means self-employment and property income combined, before expenses.
• You can join voluntarily before your mandatory date.

What is Making Tax Digital for Income Tax?

MTD for Income Tax replaces the single annual Self Assessment return, for those it applies to, with digital record-keeping throughout the year and four quarterly updates to HMRC, followed by a final declaration. The aim is to reduce errors from year-end record reconstruction by keeping things current throughout the year.

Who needs to join, and when

Eligibility is based on your qualifying income — your total gross income from self-employment and property, combined, before deducting expenses — in the tax year two years before the one MTD applies to. Per GOV.UK's Making Tax Digital for Income Tax eligibility guidance, the phasing is:

Worked example (illustrative)

Consider "Alex", an illustrative example: a private hire driver with self-employment income of £58,000 and no property income in the 2024/25 tax year. Because Alex's qualifying income for 2024/25 is above £50,000, Alex was mandated into MTD for Income Tax from 6 April 2026 and must now keep digital records and submit quarterly updates for that year onward.

By contrast, a landlord with combined self-employment and rental income of £35,000 in 2024/25 was not mandated in the first wave, but would be brought in from 6 April 2027 if their combined 2025/26 income stays above £30,000.

Common mistakes and the penalties they trigger

• Assuming self-employment income alone determines eligibility. Property income counts too — the two are added together.
• Missing a quarterly update deadline. Late submissions fall under HMRC's points-based penalty system for MTD, where repeated missed deadlines accumulate points toward a financial penalty.
• Using software that is not MTD-compatible. Check GOV.UK's list of recognised software before your mandatory start date, not after.

For the current list of confirmed penalty amounts and the points threshold, check the current HMRC figure on GOV.UK rather than relying on a fixed number here, since penalty details are subject to change.

If you drive for Uber, Bolt, or another platform and want help working out whether you are affected, see our Uber driver tax return guide, or read more about our MTD compliance service.