Making Tax Digital, explained without the jargon

You may have heard that tax is "going digital". If you're self-employed or a landlord, it affects you — but it's far less scary than the name suggests. Here's the whole thing in plain English.

Making Tax Digital for Income Tax (sometimes shortened to MTD for ITSA) is a change to how you tell HMRC about your income. The tax rules themselves aren't changing — what's changing is that reporting moves online and happens more often.

Who does it apply to?

It applies to sole traders and landlords, based on your gross income (that's your income before you take off any expenses) from self-employment and property added together. If your only income is a job or a pension, MTD isn't aimed at you.

When does it start for me?

It's being phased in by income level, and HMRC looks at a specific past tax year to decide which wave you're in:

• April 2026 — if your combined self-employment and property income was over £50,000 in the 2024/25 tax year.
• April 2027 — if it was over £30,000 (based on your 2025/26 income).
• April 2028 — if it was over £20,000 (based on your 2026/27 income).

In other words, the test year steps forward with each wave. HMRC works this out from your submitted Self Assessment returns and writes to you to confirm.

What actually changes?

Two things. First, you'll keep your records digitally rather than in a shoebox or a notebook. Second, instead of one tax return a year, you'll send HMRC a short update every quarter — four times a year — plus a final declaration after the tax year ends that ties everything together.

What should I do now?

If your income is near or above the thresholds, the best move is simply to get set up before your start date, so your first quarter isn't a scramble. You don't need to learn any software — that's what we're here for.

This guide is general information, not personal tax advice. Making Tax Digital rules and thresholds can change — always confirm the latest position on GOV.UK or ask us. Dates and figures reflect the position announced for 2026–2028 as at 2025/26.