Making Tax Digital for income tax

What do you need to know?

Making tax digital for income tax will be mandatory for some sole traders and property owners from April 2026

If you had turnover or property income of over £50,000 or your combined total is over £50,000 as reported on your 24/25 tax return you will be legally required to keep digital records and make quarterly submissions to HMRC

This does not need to be as scary as it sounds. Digital records can be kept in a spreadsheet and reported to HNRC via bridging software or using MTD compatible accounting software.

The benefit of software is that these can link directly to your bank and feed the information into them. Which in turn saves a lot of the data processing.

If you have a spreadsheet and it works well for you. There is no need to change it. It is a misconception that MTD can only be done using accounting software.

Future dates

25/26 income from self employment, property or combined is over £30,000 you will be mandated from April 2027

26/27 income from self employment, property or combined is over £20,000 you will be mandated from April 2028