HM Revenue & Customs (HMRC) is introducing Making Tax Digital for Income Tax (MTD for ITSA), which will change how individuals with self-employment and/or property income report their tax information.
The new rules will be introduced in phases from April 2026 and will require affected individuals to keep digital records and submit regular updates using compatible software.
Below are answers to the most common questions we are receiving from clients.
Who does Making Tax Digital for Income Tax apply to?
MTD for Income Tax applies to individuals with self-employment and/or property income whose gross qualifying income (before expenses) exceeds the relevant threshold.
Income from employment, pensions, savings and dividends is not included when assessing whether you are within scope.
When will I need to start Making Tax Digital?
MTD for Income Tax will apply from:
• 6 April 2026 if qualifying income is over £50,000
• 6 April 2027 if qualifying income is over £30,000
• 6 April 2028 if qualifying income is over £20,000
HMRC will use the figures shown on your most recent tax return to determine whether you are required to comply.
Will I still need to submit a tax return each year?
Yes. The requirement to submit an annual tax return remains.
Under MTD, this will be done through compatible software and supported by quarterly updates submitted during the year.
What are Quarterly updates?
Quarterly updates are summeries of income and expenses submitted during the tax year.
These updates are not tax calculations and do not determine the amount of tax payable.
Do I need special software?
Yes. HMRC requires that quarterly updates and annual submissions are made using MTD-compatible software.
Spreadsheets can be used to record information, provided they are linked to compatible software for submission.
How can Keith Willis Associates help?
At Keith Willis Chartered Accountants, we offer an MTD compliance service where you provide your income and expense information each quarter using a dimple spreadsheet. We will then submit the quarterly updates and annual submissions to HMRC on your behalf.
What is the cost?
Our fee for this services is £100 + VAT per quarter.
What should I do now?
If you have any questions about Making Tax Digital for Income Tax or how it may affect you, please contact us.
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