Making Tax Digital for Income Tax is a legal requirement to keep digital business records and send HMRC a short online update every three months, rather than relying on one Self Assessment return a year. It has applied since 6 April 2026 to sole traders and landlords with qualifying income over £50,000, and from 6 April 2027 it extends to anyone with combined self employment and property income over £30,000.
For those newly affected, the change is less about the tax owed and more about how records are kept. Four quarterly updates are followed by a year-end final declaration – similar in substance to the annual tax return many people are used to, but sent through compatible software rather than HMRC’s own online service. A shoebox of receipts sorted once a year is no longer enough.
More than 436,000 sole traders and landlords successfully sent their first Making Tax Digital for Income Tax quarterly update, and over 570,000 had signed up to the service, HMRC confirmed as at 12 August 2026. The next wave is expected to be considerably larger.
If your combined income from self-employment and property sits between £30,000 and £50,000, your 2025/26 tax return is the one HMRC will use to decide whether you join from 6 April 2027, so the time to prepare is now rather than next spring.