Making Tax Digital for Income Tax: Are You Ready?
Making Tax Digital is a government initiative changing how we submit financial information to HMRC. All VAT-registered businesses must now comply with Making Tax Digital (MTD). Now, attention is turning to self-assessment tax returns for sole traders and landlords.
This next phase of MTD affects sole traders and those with self employed income, such as property landlords. The planned timescale is:
- Sole traders and landlords with qualifying income over £50,000 – April 2026.
- As above with qualifying income over £30,000 – April 2027.
- As above with qualifying income over £20,000 – April 2028.
From April 2026, individuals and landlords with qualifying income above £50,000 will need to submit their Self Assessment tax returns via the Making Tax Digital scheme. Complying with Making Tax Digital (MTD) requires the use of digital record-keeping and the submission of quarterly updates to HMRC.
Starting in November 2025, HMRC will send letters to affected taxpayers who have submitted their 2024 to 2025 tax returns. Letters to those who have not yet submitted their 24-25 tax returns will follow and the timing is to be confirmed. The letters will:
- inform taxpayers that they need to use MTD for Income Tax from April 2025. (This decision is based on information they have submitted.),
- outline what’s needed in order to be ready for MTD for Income Tax, and
- include a QR code linking people to GOV.UK for guidance.
If you receive one of these letters, don’t worry — the friendly experts at Hargreaves Owen Chartered Certified Accountants are here to help. We help clients to make the transition to MTD as smooth as possible, involving:
- Recommending cloud-based, MTD-compatible software.
- Outlining key deadlines as quarterly submissions are required
- Ensuring your MTD registration is correct and on time.
- Answering any questions. We know this is new and will answer queries without any jargon. Our goal is to make your move to MTD stress-free, so you can focus on your business or personal finances, not the technicalities of filing.
Are you affected by MTD for Income Tax?
Early preparation is ideal for avoiding last-minute pressure. The Hargreaves Owen team is here to help make your move to MTD stress-free. To discuss the requirements and get ready, please contact us.