Taxpayers earning over £50,000 from self-employment or property income will need to adhere to new MTD for Income Tax rules, and the change will hit around 780,000 individuals.
HMRC says the next Making Tax Digital change will kick in on April 6, 2026. Taxpayers earning over £50,000 from self-employment or property income will need to adhere to new MTD for Income Tax rules, and the change will hit around 780,000 individuals.
The subsequent wave will be introduced from April 2027 for those earning between £30,000 and £50,000.
By keeping digital records throughout the year, sole traders and landlords can save hours previously spent gathering information at tax return time – allowing them to spend more time focusing on their business activities and in turn, driving economic growth as part of the government’s Plan for Change.
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Quarterly updates will spread the workload more evenly throughout the year, bring the tax system closer to real-time reporting and help businesses stay on top of their finances and avoid the last-minute rush.
James Murray MP, Exchequer Secretary to the Treasury, said: “MTD for Income Tax is an essential part of our plan to transform the UK’s tax system into one that supports economic growth.
“By modernising how people manage their tax, we’re helping businesses work more efficiently and productively while ensuring everyone pays their fair share.
“This is a crucial step in this government’s decade of national renewal and our Plan for Change, as we clear away barriers that hold back growth.” Craig Ogilvie, HMRC’s Director of Making Tax Digital, said: “MTD for Income Tax is the most significant change to the Self Assessment regime since its introduction in 1997.
“It will make it easier for self-employed people and landlords to stay on top of their tax affairs and help ensure they pay the right amount of tax.
“By signing up to our testing programme now, self-employed people and landlords will be able to familiarise themselves with the new process and access dedicated support from our MTD Customer Support Team, before it becomes compulsory next year.”