Making Tax Digital 2026 is now in force for sole traders and landlords who were required to join from 6 April 2026. If your qualifying income from self-employment and property was over £50,000, you should now be keeping digital records and using compatible software for MTD for Income Tax.
This guide explains what has changed in 2026, who is affected, what you need to do now and the key requirements to understand.
Who must comply from 6 April 2026
From 6 April 2026, you must use Making Tax Digital for Income Tax if your annual income from self-employment and property is over £50,000.
Important: it’s based on your tax return
HMRC uses the tax return you submit for the relevant year to decide when you must join. For the first mandation wave, the key figure is your qualifying income (income from self-employment and property).
Key MTD for Income Tax dates for 2026
If you must join from 6 April 2026, HMRC’s published timeline highlights:
- 6 April 2026 – you must start keeping digital records in MTD-compatible software
- 7 August 2026 – first quarterly update deadline
- 7 November 2026 – second quarterly update deadline
- 7 February 2027 – third quarterly update deadline
- 7 May 2027 – fourth quarterly update deadline
For the full reporting calendar and an explanation of standard and calendar update periods, see our MTD for Income Tax deadlines guide
What you must do under MTD for Income Tax
If you are in scope, you (or your accountant/agent) will need to use software that works with MTD for Income Tax to:
- Keep digital records of your business and/or property income and expenses
- Send quarterly updates to HMRC (via software)
- Use the new digital process to complete your year-end position (your software will handle the required submissions)
Quarterly updates: what they are (and what they aren’t)
Quarterly updates are not the same as a “full set of final accounts.” They are regular submissions of income and expense totals, sent through your software to reduce end-of-year pressure and improve visibility across the year. The deadlines above apply for taxpayers starting in April 2026.
Penalties: the first-year easing you should know about
If you are required to use Making Tax Digital for Income Tax from 6 April 2026, HMRC will not apply penalty points for late quarterly updates for the first tax year (2026–2027). However, penalties still apply for late tax returns and late payment of tax due.
This is helpful, but it is not a reason to delay preparation. It is designed to give people a “settling-in” period, not to encourage last-minute changeovers.
For a detailed explanation of the points-based system and financial penalties, read our Making Tax Digital penalties guide.
What to Do Now Under Making Tax Digital 2026
1) Confirm whether you are already in scope
If your 2024/25 tax return showed qualifying income over £50,000, you should have been using MTD for Income Tax since 6 April 2026. Qualifying income is broadly your gross income from self-employment and property before expenses.
2) Make sure you are using MTD-compatible software
You need compatible software to keep digital records and send quarterly updates to HMRC. Make sure your software is authorised for MTD for Income Tax and that your records are being maintained digitally throughout the year.
3) Fix your record-keeping workflow
If your digital records are not yet fully up to date, focus on improving:
- how you store invoices/receipts
- how you categorise expenses
- how you track rental income/allowable costs (if you’re a landlord)
- whether bank feeds and reconciliation are in place
4) Make sure you are signed up and your software is ready
If you were required to use MTD for Income Tax from 6 April 2026, HMRC says you should sign up now if you have not already done so. You should have compatible software in place before signing up and make sure it is authorised to work with MTD for Income Tax.
Common questions
“I’m a landlord and a sole trader do I add both incomes together?”
Yes. HMRC combines your qualifying gross income from self-employment and property when determining whether you exceed the MTD threshold.
“What if I’m under £50,000?”
MTD for Income Tax is being introduced in stages. Qualifying income over £30,000 brings you into MTD from 6 April 2027, based on your 2025/26 tax return. Qualifying income over £20,000 brings you in from 6 April 2028, based on your 2026/27 tax return. For rules specifically affecting sole traders, read our Making Tax Digital for the self-employed.
“If there’s no penalty points in year one, can I ignore quarterly updates?”
No. HMRC is only pausing penalty points for late quarterly updates in the first year for those mandated from 6 April 2026. The obligation still exists, and other penalties still apply.
Final thoughts
Making Tax Digital 2026 is already in force for the first group of affected sole traders and landlords. If you are in scope and need help with compatible software, digital records or quarterly reporting, our Making Tax Digital accountants can help you manage the transition and ongoing requirements.
Last reviewed: 20 August 2026
