Making Tax Digital for Income Tax

Making Tax Digital for Income Tax is commonly abbreviated to MTD ITSA

Call: 01692 582222

Request a call back

Understanding HMRC’s New Digital Tax Regime

MTD ITSA is a new tax regime introduced by HMRC which requires tax payers to keep digital records and use commercial software to summarise the digital records and submit to HMRC on a quarterly basis. 

 There will be a phased introduction with those with self-employment and property income exceeding £50,000 required to start using the new regime from 2026. The requirement to comply in April 2026 is based on the turnover declared in the tax return for the tax year ending 5th April 2025.

The phased introduction is expected to extend to tax payers with income exceeding £30,000 from April 2027and is likely to further reduce to £20,000 from April 2028 however this will be confirmed by HMRC in due course. The requirement to comply from April 2027 will be based on the income declared in the tax return submitted for the tax year ending 5th April 2026 and all subsequent compliance years will be based on the income in the previous tax year.

Help you to keep digital records

  • Discuss the use of commercial software
  • Help to enrol into the regime
  • Manage your quarterly submissions
  • Complete the end of year declaration
  • Ensure compliance
  • Support understanding and offer advice and guidance

Frequently Asked Questions

No MTD for income tax has not been extended to partnership income, HMRC plans to introduce this in the future but the date has not been confirmed

Your employment income is not relevant income for MTD ITSA and as of April 2026 the property income is below the threshold. You will need to comply when your income exceeds the threshold.

Yes you will need to comply with MTD ITSA based on the income from your sole trade. Partnership income is not relevant income currently. This is likely to be rolled out in the future.

Employment income is not relevant income for MTD ITSA and the property income is currently below the threshold required for compliance, you should look out for updates of when HMRC require you to make MTD submissions.

If your income drops below the required threshold set by HMRC for three successive years you are able to leave the regime and you should re-join when your income exceeds the threshold again. This timescale has been introduced to avoid tax payers leaving and re-joining on a regular basis.

What our customers say