HMRC has been contacting people to remind them of a new rule that came into effect in April and will impact more individuals over the next few years.
What is Making Tax Digital?
In an email, HMRC reminded recipients about Making Tax Digital (MTD), a new approach to self-assessment for those who are self-employed or receive income from property. Rather than completing a single tax return at the end of each tax year, individuals will be required to use a new system to submit quarterly reports alongside an end-of-year one.
MTD-compatible software must be used to comply with the new method. HMRC confirmed that MTD is being introduced gradually.
Who is affected and when?
- For those whose turnover exceeded £50,000 in the 2024/25 tax year, MTD is already required from April 2026.
- From April 2027, those who turned over more than £30,000 in the 2025/26 tax year will need to begin using the system.
- Those who earned more than £20,000 in 2026/27 will need to use it from April 2028.
HMRC confirmed that it is running webinars about MTD to assist landlords, joint property owners, and businesses in preparing. Businesses can register for the webinar 'How to get ready for MTD if you are a business'. Those who receive income from property can register for the webinar 'Get ready for Making Tax Digital – landlords and joint property owners'.
Webinar content
The sessions will cover the requirements of MTD for Income Tax, practical steps to prepare your business, the rules, who will be affected and when, making informed software choices, authorising your agent (if applicable), and signing up to MTD and utilising any benefits and opportunities.
How to get ready for Making Tax Digital if you're a sole trader
HMRC said: "If you're a sole trader or landlord without an accountant or bookkeeper, register for this webinar for the latest information about MTD, to help you get ready for when MTD for Income Tax, which is now a legal requirement from April 6, 2026, for those with a turnover over £50,000."
The webinar will examine planning for MTD for Income Tax, understanding the regulations and determining whether you're affected and when, how to prepare for MTD for Income Tax, including what you need to do, the actions you will take, signing up for MTD for Income Tax, and using MTD for Income Tax – adhering to the rules and considering how to make the most of any benefits and opportunities.
There are also short videos, including 'How do I sign up for Making Tax Digital for Income Tax', available on HMRC's YouTube channel.
