Making Tax Digital
for Income Tax 2026
The biggest change to the UK tax system in a generation is here. From 6 April 2026, self-employed people and landlords earning over £50,000 must file quarterly digital returns to HMRC — replacing the annual Self Assessment. Are you ready?
from April 2026
required per year
after 4 penalty points
2026 / 2027 / 2028
for Income Tax?
MTD for Income Tax (MTD ITSA) is HMRC’s programme to replace the traditional annual Self Assessment with a fully digital system of quarterly reporting. It’s mandatory — not optional — for those above the income threshold.
Instead of filing one annual Self Assessment return, you must keep digital records throughout the tax year and submit quarterly summaries of your income and expenses to HMRC using HMRC-compatible software.
After your fourth quarterly update, you submit an End of Period Statement (EOPS) for each income source, then a Final Declaration — which replaces the traditional SA100 tax return entirely for those in scope.
⚠️ Important: The threshold is based on gross income before expenses — not your profit. If your turnover is £55,000 but profit is £20,000, you are still mandated from April 2026.
- Digital record keeping throughout the tax year
- Four quarterly updates submitted via HMRC-compatible software
- End of Period Statement (EOPS) for each income source
- Final Declaration replacing the traditional SA100
- Real-time visibility of your estimated tax liability
- Tax payment dates remain unchanged (31 Jan / 31 Jul)
- Your tax payment deadlines — these stay the same
- The amount of tax you owe — MTD only changes how you report
- Your ability to claim expenses and reliefs as normal
- Your accountant’s ability to file on your behalf
- Gross income from self-employment (sole trader turnover)
- UK rental income from property businesses
- Overseas property rental income
- Multiple sole trader businesses — each reported separately
Does NOT include: PAYE employment income, dividends, pensions, savings interest, or capital gains.
Rental income: £35,000 + Freelance: £22,000 = Total: £57,000 — Mandated from April 2026.
Even though profit after mortgage and expenses may be much lower, gross income determines whether MTD applies.
MTD for Income Tax is being introduced in three waves based on gross income thresholds. Each phase brings more taxpayers into scope — eventually covering the majority of self-employed people and landlords in the UK.
For the 2026/27 tax year, each quarterly update covers cumulative income and expenses for the year-to-date. Deadlines are the 7th of the month following the quarter end. Miss four deadlines and you face automatic £200 penalties.
(or 1 Apr – 30 Jun)
(or 1 Jul – 30 Sep)
(or 1 Oct – 31 Dec)
(or 1 Jan – 31 Mar)
After all four quarterly updates, you submit your End of Period Statements (EOPS) and Final Declaration — replacing the SA100 entirely. The Final Declaration deadline remains 31 January following the tax year end. For 2026/27, this is 31 January 2028. This deadline carries normal HMRC penalties — there is no soft landing for the annual declaration.
MTD for Income Tax applies to individuals — not companies, partnerships, or trusts (yet). Here’s who is affected in the first phase from April 2026.
If you’re mandated from April 2026, these are the four steps you need to take. Britvex can handle steps 2, 3, and 4 entirely on your behalf.
HMRC is introducing a points-based penalty regime for MTD. While 2026/27 has a soft landing for quarterly updates, the annual Final Declaration carries full penalties from day one.
- You must still keep digital records from 6 April 2026
- You must still submit your quarterly updates even during the soft landing
- The Final Declaration (due 31 Jan 2028) carries full penalties — no soft landing
- Late payment interest applies from 2026 — no exemption
- The soft landing does not apply to Phase 2 or 3 taxpayers joining in 2027/2028
- Britvex recommends filing on time regardless — habits formed in 2026/27 matter
All MTD submissions must be made through HMRC-approved software — you cannot submit quarterly updates through HMRC’s own website. Britvex is certified in all three major MTD-compatible platforms, and we manage everything for you.
Everything you need to know about Making Tax Digital for Income Tax — answered by our qualified UK accountants.
MTD touches many areas of your tax and financial life. Explore our related services and guides to stay fully compliant and plan ahead.
MTD replaces the annual Self Assessment for mandated taxpayers. We handle both — current SA and the transition to MTD Final Declaration.
Learn More → VAT & MTD for VATMTD for VAT is already fully operational since 2022. If you’re VAT-registered, you’re already in the digital tax system — we manage both.
Learn More → MTD Software SetupWe set up Xero, QuickBooks or Sage for MTD compliance, migrate your records, and train you or your team on the new system.
Get Set Up → Bookkeeping & RecordsMTD requires digital record keeping throughout the year. Our bookkeeping service maintains your records quarterly-ready at all times.
Learn More → Landlord Tax ServicesSpecialist landlord accountancy including rental income tax, property allowances, and full MTD compliance for UK and overseas property.
For Landlords → Tax PlanningMore frequent reporting under MTD creates more opportunities for proactive tax planning. We review your position quarterly — not just at year end.
Plan Ahead → Sole Trader ServicesFrom registration to MTD compliance, payroll, and tax returns — complete sole trader accountancy from one dedicated ACCA-qualified accountant.
For Sole Traders → MTD Guides & InsightsFree expert articles on MTD, HMRC deadlines, self assessment, and UK tax changes — written by our qualified team and updated regularly.
Read Free Guides →