10 min read
If you’re a sole trader or landlord earning more than £50,000 a year, Making Tax Digital for Income Tax isn’t something you can schedule for later. HMRC introduced the new rules from 6 April 2026, and if you meet that income threshold from the 24/25 tax year, you’re now legally required to comply with MTD for Income Tax.
We’ve had a steady stream of clients at Golding asking us what this actually means for them. Some received letters from HMRC and weren’t sure what to do next. Others had heard bits and pieces but weren’t clear on the full picture. So here’s the full picture.
What Making Tax Digital for Income Tax actually changes
The Self Assessment system most sole traders and landlords have used for years involved filing one tax return per year, usually in a mad rush before 31 January. MTD for Income Tax replaces that rhythm.
From now on, you must keep digital records of your income and expenses as the year goes on, and you send HMRC a summary of those figures every three months. At the end of the year, you still file a final return. That’s effectively five submissions a year instead of one, using software that connects directly to HMRC’s systems.
The tax payment dates stay the same. January deadlines haven’t moved. It’s the reporting that’s changed.
Who's caught by the rules from April 2026
Gross income, not profit. If your turnover is £55,000 but your costs bring profit down to £28,000, you’re still in scope.
A few examples of who this covers:
- Freelancers and contractors with annual billings above £50,000
- Landlords whose rental income clears £50,000 before expenses
- Anyone who’s both self-employed and renting out property, where the two combined cross that line
HMRC estimates that hundreds of thousands of taxpayers are affected in this first wave and has been sending letters to those expected to fall within the rules. If you haven’t received a letter, don’t take it that you don’t classify – if your earnings were over £50,000 in the 2024/25 financial year, then you do.
The end of the “once a year” approach
The rules are coming for you too, just not yet. The £30,000 threshold kicks in from April 2027 against income in the 2025/26, and the government has also announced plans to extend MTD for Income Tax to those earning over £20,000 from April 2028. Getting set up now, before it’s mandatory, puts you ahead.
The steps you need to take
Register with HMRC for MTD
You register through HMRC’s online service. If you’ve filed Self Assessment before, the same Government Gateway login works. Ideally this should’ve happened before 1 April, but if it hasn’t, do it now rather than leaving it any longer.
Sort out your software
The old Self Assessment portal is out. MTD requires software that connects directly to HMRC to store your records, generate quarterly updates and file your return.
Most of our clients at Golding use Dext Solo if they are not VAT registered, which keeps everything in one place and makes the quarterly submissions fairly painless.
Keep records as you go, not at year end
All income and expenses need to be logged digitally throughout the year. Not gathered up in December and entered in a panic. The software handles storage, but you need to be feeding it information regularly. For most people this becomes routine fairly quickly once it’s set up properly.
Hit your four quarterly deadlines
Every three months, you send HMRC a summary of what’s come in and what’s gone out. The periods and deadlines are:
| Quarter | Period | Deadline |
| Q1 | 6 April to 5 July | 7 August 2026 |
| Q2 | 6 July to 5 October | 7 November 2026 |
| Q3 | 6 October to 5 January | 7 February 2027 |
| Q4 | 6 January to 5 April | 7 May 2027 |
Quarterly updates are summaries of your business income and expenses for the period. They are not a final tax return and do not establish your tax liability. The software generates it from the records you’ve been keeping. Maintaining accurate digital records throughout the year can help you make quarterly submissions more simple.
File your final declaration
After Q4 goes in, you file your year-end return. This is where additional income like bank interest gets added and you confirm the full picture. For 2026/27, that final return is due by 31 January 2028.
Penalties for missing submissions
HMRC uses a points system. Each missed submission adds a point. Four points triggers a £200 fine, and it escalates from there.
There’s a concession for the first year. People who joined MTD in April 2026 won’t face penalty points for late quarterly updates during 2026/27. Late year-end returns are a different matter though; the points system covers those from day one.
This grace period is a safety net, not a strategy. Getting into the habit of submitting on time costs nothing and saves a lot of stress.
Questions we hear a lot
1. Does any of this change when I pay my tax?
2. Can my accountant deal with all of this on my behalf?
Yes. At Golding we handle the sign-up, software setup, quarterly submissions and year-end return for clients who’d rather not deal with it themselves. A lot of our sole trader and landlord clients have gone down that route.
3. I run a limited company. Does this affect me?
MTD for Income Tax doesn’t apply to limited companies. If you’re VAT-registered, you’re already under MTD for VAT, but that’s a separate thing.
4. I jointly own a rental property. How does HMRC calculate my income?
HMRC looks at your individual share of the rental income, not the total the property generates. If your share alone stays under £50,000 and you have no other relevant income, you may not be in scope yet. Worth getting specific advice on this one.
Where things stand now
The first quarterly deadline for 2026/27 is 7 August 2026. That’s the Q1 submission covering April to July, and it’s not far off.
If you’re already registered and have your software running, you’re in good shape. If you haven’t started yet, this is the week to sort it out.
Golding works with sole traders and landlords across Essex and the rest of the UK. Getting set up on MTD is something we can walk you through quickly, or take off your plate entirely if you’d rather. Contact ustoday!
Anthony Burrell is the Tax Director at Golding Accountancy, specialising in UK personal tax, compliance, and strategic tax planning. He works with business owners, landlords, and property investors across the UK, helping them navigate complex tax legislation while ensuring they remain compliant and tax-efficient. Outside the office, Anthony is a dedicated West Ham supporter and has been a season ticket holder for more than 40 years. He also recommends Dext to clients looking to simplify their bookkeeping and financial processes.
