Making Tax Digital (MTD) for Income Tax
- Aamer Amin
- Jun 24
- 2 min read
As explain in my previously blog the Making Tax Digital (MTD) for Income Tax is a government initiative aimed at making
the tax system more effective, efficient, and easier for taxpayers. Specifically, MTD for
Income Tax Self-Assessment (ITSA) will impact self-employed individuals and landlords.
What Is MTD for Income Tax?
MTD for ITSA requires affected individuals to:
Keep digital records of their business income and expenses.
Use MTD-compatible software to submit updates to HMRC.
Send quarterly updates to HMRC summarising income and expenses.
Submit an End of Period Statement (EOPS) and Final Declaration (similar to a Self-Assessment return) at the end of the tax year.
When Does It Start?
From April 2026, MTD for ITSA becomes mandatory for individuals with total income (not profit) from self-employment and property over £50,000.
From April 2027, it will apply to those with income over £30,000.
Who Is Affected?
You are affected if all of the following apply:
You are self-employed and/or a landlord.
Your combined business and property income exceeds £50,000 annually.
You are currently within the Self-Assessment system.
If your total income is over £50,000 but it’s solely from employment (PAYE) or pensions, you’re not affected by MTD for ITSA.
Impact on a Taxpayer with £50,000+ Income
Aspect | Before MTD | After MTD (April 2026) |
Record keeping | Can be manual or digital | Must be fully digital |
Reporting | 1 Self-Assessment per year | 4 quarterly updates + 1 EOPS + 1 Final Declaration |
Software | Optional | Must use MTD-compatible software |
Admin workload | Moderate | Higher, but manageable with good tools |
HMRC submission | Once per year | At least 6 submissions per year |
What Should Taxpayers Do Now?
If you're a taxpayer earning over £50,000 from business or property, for further guidance and advise contact Amin & Co Accountants or call at 0161 224 3510
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