Making Tax Digital

What Self-Employed People & Landlords Need to Know About Making Tax Digital for Income Tax

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From April, the UK is moving a big step further toward digital tax reporting. Making Tax Digital for Income Tax Self Assessment (often called “MTD for ITSA”) will require many sole traders and landlords to change how they keep records and report their income. As your trusted accountancy partner, we're here to demystify the process and help you comply smoothly.

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What is “Making Tax Digital for Income Tax”?

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“Making Tax Digital” (MTD) is HMRC’s long-running programme to bring more of the UK tax system online, simplify tax processes, and reduce errors. The programme already applies to VAT, and the next phase is extending it to income tax for individuals with self-employment or rental (property) income.

Under MTD for ITSA:

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• You’ll need to keep digital records of your self-employment and property income and expenses (using HMRC-approved software).
• You’ll submit regular quarterly updates (rather than waiting until the end of the tax year).
• At the year end, you’ll make an “End of Period Statement” (confirming or adjusting your totals) and submit a Final Declaration.

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The aim is to make tax more real-time, reduce errors, and give both businesses and HMRC better visibility into tax liabilities.

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Who will need to use it — and when?

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Qualifying income thresholds & timeline

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Not everyone will be required to adopt MTD for ITSA immediately. It’s being introduced in phases based on your qualifying income (i.e. combined income from self-employment + property).

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Here’s the current timetable under HMRC’s policy: 

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Please contact us to discuss your MTD needs and we can provide you with a quotation to manage your MTD compliance.