With Making Tax Digital set to come into force from April 2026, it’s important for self-employed individuals and landlords to understand what this means for their finances. The shift to a fully digital system marks a significant change in how tax information is recorded and submitted to HMRC. If you fall within the new thresholds, now is the time to prepare and ensure you’re ready for the transition.
Whilst the rollout has faced delays in the past, Making Tax Digital is now moving forwards and those affected will need to adapt to new processes and reporting requirements.
Making Tax Digital explained: What’s changing?
At its core, Making Tax Digital requires taxpayers to keep digital records and submit updates to HMRC on a quarterly basis using compatible software. This replaces the traditional annual Self Assessment process with more frequent reporting.
From 6 April 2026, Making Tax Digital will apply to individuals with gross income (not profit) from self-employment and/or property of over £50,000. This threshold will reduce over time, bringing more people into the system:
- £50,000+ from April 2026
- £30,000+ from April 2027
- £20,000+ from April 2028
Understanding where you fall within these thresholds is key to knowing when you’ll need to comply.
Key requirements under Making Tax Digital
Under Making Tax Digital, there are several important changes to be aware of. You’ll need to maintain accurate digital records of your income and expenses and submit updates to HMRC every quarter. The deadlines for these submissions will typically fall on:
- 7th August
- 7th November
- 7th February
- 7th May
In addition, a final “digital tax return” will still be required to confirm your overall tax position for the year.
If your income is below the VAT threshold, reporting may be simplified into three main figures: income, expenses and profit or loss. However, the requirement to keep everything digitally recorded remains the same.
What this means for landlords and the self-employed
For many, Making Tax Digital will mean a shift in how they manage their finances day-to-day. Instead of preparing accounts once a year, you’ll need to stay on top of your records throughout the year.
If you run more than one business, for example, you’re both a landlord and a sole trader, Making Tax Digital will require separate digital records and submissions for each. UK and overseas properties are also treated as separate business categories.
Whilst some individuals may qualify for exemptions, most will need to adapt to the new system. Choosing the right software and understanding your obligations early will make the transition much smoother.
How Accounts & Returns can help
Navigating Making Tax Digital doesn’t have to be overwhelming. At Accounts & Returns, we support clients across the UK with everything from initial setup to ongoing compliance.
We can register you for MTD ITSA and prepare and submit your returns on your behalf, ensuring everything is accurate and on time. With MTD ITSA, you’ll need to file four quarterly returns during the year, plus an end-of-year update alongside your usual tax return. Depending on your circumstances, this could include separate submissions for sole trade income, UK property income and overseas property income.
Our expert team can:
- Help you choose and implement the right accounting software
- Set up and manage your digital records
- Handle quarterly submissions on your behalf
- Provide ongoing advice to keep you compliant
Our proposed fees for MTD ITSA are £30 + VAT per return for sole trade and UK property income. Overseas property returns are quoted on an individual basis. If you’d prefer to spread the cost, we can also arrange monthly payment options to suit your budget.
Tax return fees will remain in line with current rates and we offer flexible, fixed-fee packages tailored to sole traders, landlords and limited companies, so you get the right level of support without unexpected costs.
Get ready for Making Tax Digital
With Making Tax Digital just around the corner, taking action now can save you time, stress and potential penalties later. The earlier you get set up, the easier it will be to adapt to quarterly reporting and digital record-keeping.
Accounts & Returns has numerous branches across the UK, offering local, expert support whenever you need it. Whether you’re unsure if the rules apply to you or need help getting started, our team is here to guide you every step of the way.
Get in touch today and make the move to Making Tax Digital simple and stress-free.
