Introduction
Source: gov.uk (2025-05-22)

About Making Tax Digital for Income Tax, who needs to use it and by when, and what to expect after you sign up.

Making Tax Digital for Income Tax is a new way for sole traders and landlords to report income and expenses to HMRC.

From 6 April 2026, some sole traders and landlords must use it, based on their total annual income from self-employment and property.

You, or your agent if you have one, will need to use software that works with Making Tax Digital for Income Tax (https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax) to:
- create, store and correct digital records of your self-employment and property income and expenses
- send your quarterly updates to HMRC
- submit your tax return by 31 January the following year
Who will need to do it

Sole traders and landlords will need to use Making Tax Digital for Income Tax, unless they are exempt (https://www.gov.uk/guidance/check-if-youre-eligible-for-making-tax-digital-for-income-tax), if the following apply. They:
- are registered for Self Assessment (https://www.gov.uk/self-assessment-tax-returns/sending-return)
- get income from self-employment or property, or both
- have qualifying income (https://www.gov.uk/guidance/work-out-your-qualifying-income-for-making-tax-digital-for-income-tax) of more than £20,000
Qualifying income is the total gross income (before deducting expenses or taxes) from self-employment and property in a tax year.

Other income sources such as from employment (PAYE), partnership income or dividends (including those from your own company) are not included in qualifying income.

When you will need to use Making Tax Digital for Income Tax

When you need to start using Making Tax Digital for Income Tax depends on your qualifying income for a tax year. If your qualifying income is over:
- £50,000 for the 2024 to 2025 tax year, you will need to use it from 6 April 2026
£30,000 for the 2025 to 2026 tax year, you will need to use it from 6 April 2027
- £20,000 for the 2026 to 2027 tax year, the government has set out plans to introduce legislation to lower the qualifying income threshold (https://www.gov.uk/government/publications/modernising-the-tax-system-through-making-tax-digital)
Use our tool to find out if and when you or your client needs to sign up (https://www.gov.uk/guidance/check-if-youre-eligible-for-making-tax-digital-for-income-tax).

If you want to sign up early

Sole traders, landlords, and their agents can sign up early to test the service before they’re required to use Making Tax Digital for Income Tax.

Signing up early also means you can get dedicated support from HMRC.

HMRC will not issue penalties for missing quarterly update deadlines during the testing phase. Read more on new penalties and when they apply (https://www.gov.uk/guidance/penalties-for-income-tax-self-assessment-volunteers).

What to do next

You can use this guidance to find out more information about:
- what to expect after you sign up
- the different steps you will need to take during the tax year
- what to do if your circumstances change (https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/if-your-circumstances-change)
To check whether you can sign up early and use Making Tax Digital for Income Tax, read important steps for signing up. For those already signed up, check you’ve completed all steps you need to continue using the service if you are:
- a sole trader or landlord (https://www.gov.uk/government/collections/making-tax-digital-for-income-tax-for-businesses-step-by-step)
- an agent with a client signed up to the service (https://www.gov.uk/government/collections/making-tax-digital-for-income-tax-as-an-agent-step-by-step)