April 2026 might sound like the distant future, but it’s just around the corner. From that date, HMRC will begin phasing in Making Tax Digital (MTD) for Income Tax.
If you are a sole trader or landlord with gross self-employment and/or property income over £50,000, you will be required to join the MTD for Income Tax regime in less than seven months.
What is changing?
The annual Self-Assessment will be replaced by a new digital regime. You will need to:
- Keep digital records of income and expenditure
- Submit quarterly updates to HMRC
- Complete an annual end of year tax return to finalise your tax position
This means a move from one annual submission to a more regular reporting process.
Who is affected?
- From April 2026: Those with gross self-employed and/or property income over £50,000
- From April 2027: Threshold lowers to £30,000
- From April 2028: Threshold lowers to £20,000
Your requirement to join the system will be based on your gross income for the 2024/25 tax year, which has now ended and you may have already received a letter from HMRC advising that you will be required to join from next April
Why you must act now
With only months to go, it is critical to start preparing. Leaving it until the new year or waiting until April will create unnecessary stress and could put you at risk of penalties. Key steps include:
- Check your software – ensure it is MTD-compatible.
- If using spreadsheets – arrange bridging software.
- If using paper records – prepare for additional time and cost to digitise the information quarterly.
- Open a business bank account if you do not already have one.
Act now
MTD for Income Tax is no longer on the horizon. It’s coming in April 2026, and for many, that means just one more Self-Assessment deadlines before quarterly reporting begins.
Taking steps now will give you peace of mind and make the transition smooth.
HMRC will introduce a points-based penalty system for late or missing submissions. Occasional mistakes may not trigger immediate penalties, but repeated errors will.
At Milsted Langdon, we offer flexible support to help you comply:
- Do it yourself using MTD-compatible software – You handle the quarterly updates and we complete your annual tax return.
- Let us handle it all – You continue to send us your records in whatever format suits you. We digitise, compile and submit all quarterly submissions on your behalf.
- Hybrid approach – You record income digitally, we check and submit quarterly using either your software or ours.
We are already helping clients put the right systems in place and get comfortable with the new way of working.
Get in touch today to prepare for MTD for Income Tax and avoid the risks of leaving it too late.