{"id":46624,"date":"2026-06-22T11:06:43","date_gmt":"2026-06-22T10:06:43","guid":{"rendered":"https:\/\/taxfix.com\/en-uk\/?p=46624"},"modified":"2026-06-22T11:06:44","modified_gmt":"2026-06-22T10:06:44","slug":"what-does-making-tax-digital-mean","status":"publish","type":"post","link":"https:\/\/taxfix.com\/en-uk\/tax-changes\/making-tax-digital-mtd\/what-does-making-tax-digital-mean\/","title":{"rendered":"What does Making Tax Digital (MTD) mean?"},"content":{"rendered":"\n<p><a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/making-tax-digital\/\">Making Tax Digital<\/a>, or MTD, is HMRC&#8217;s plan to move the UK tax system online. Instead of filing one tax return at the end of the year, you&#8217;ll keep digital records and send regular updates to <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/hmrc\/\">HMRC<\/a> throughout the year using <a href=\"https:\/\/www.gov.uk\/guidance\/choose-the-right-software-for-making-tax-digital-for-income-tax\">approved software<\/a>. It&#8217;s a big shift, but the goal is to make tax simpler, more accurate, and less stressful in the long run.<\/p>\n\n\n\n<p>MTD has been rolling out in stages since 2019. The next major milestone, <a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/what-is-making-tax-digital-for-income-tax\/\">Making Tax Digital for Income Tax<\/a>,&nbsp; is now live, starting with the 2026\/27 tax year. If you&#8217;re <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/self-employed\/\">self-employed<\/a> or a <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/landlord\/\">landlord<\/a>, this change is likely to affect you.<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-purple m-align-left\">\n    <div class=\"b-block-body\">\n        <p><span style=\"font-weight: 400;\">\ud83d\udc49 <\/span><i><span style=\"font-weight: 400;\">Want to know exactly when MTD applies to you? See our<\/span><\/i><a href=\"https:\/\/taxfix.com\/en-uk\/general-tax-return-guides\/the-making-tax-digital-mtd-timeline\/\"> <i><span style=\"font-weight: 400;\">Making Tax Digital timeline<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">.<\/span><\/i><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Why is HMRC making tax digital?<\/strong><\/h2>\n\n\n\n<p>HMRC estimates that billions of pounds are lost each year through <a href=\"https:\/\/taxfix.com\/en-uk\/self-assessment-basics\/common-self-assessment-mistakes\/\">avoidable tax errors<\/a> \u2013 things like miscalculations, missing income, or simply forgetting to declare something. Going digital is designed to fix that.<\/p>\n\n\n\n<p>Here&#8217;s what HMRC is trying to achieve:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Fewer errors.<\/strong> Digital record-keeping reduces the mistakes that come with manual data entry and end-of-year scrambles.<\/li>\n\n\n\n<li><strong>Real-time visibility.<\/strong> Taxpayers will be able to see an estimate of what they owe throughout the year, rather than getting a surprise bill in January.<\/li>\n\n\n\n<li><strong>A more efficient system.<\/strong> Quarterly updates mean HMRC has up-to-date information, making it easier to spot discrepancies early.<\/li>\n\n\n\n<li><strong>Keeping pace internationally.<\/strong> Many countries already use digital tax systems. MTD brings the UK in line with global standards.<\/li>\n<\/ul>\n\n\n\n<p>It&#8217;s worth noting that MTD doesn&#8217;t change what you owe \u2013 only how you report it.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Who does Making Tax Digital apply to?<\/strong><\/h2>\n\n\n\n<p>MTD is being introduced in two main phases. Here&#8217;s a quick overview of both.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>MTD for VAT<\/strong><\/h3>\n\n\n\n<p>MTD for <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/vat\/\">VAT<\/a> has been mandatory since April 2019 for VAT-registered businesses with a taxable turnover above the <a href=\"https:\/\/taxfix.com\/en-uk\/limited-companies\/vat-threshold-uk\/\">VAT threshold<\/a>. Since April 2022, it applies to <em>all<\/em> VAT-registered businesses, regardless of turnover. If you&#8217;re already doing this, you&#8217;re ahead of the game \u2013 MTD isn&#8217;t entirely new territory. You can find more details in<a href=\"https:\/\/www.gov.uk\/guidance\/making-tax-digital-for-vat\"> HMRC&#8217;s VAT guidance on GOV.UK<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Making Tax Digital for Income Tax<\/strong><\/h3>\n\n\n\n<p>This is the big one for <a href=\"https:\/\/taxfix.com\/en-uk\/self-employed-tax-returns\/bookkeeping\/what-is-a-sole-trader\/\">sole traders<\/a>, freelancers, and landlords. Making Tax Digital for Income Tax requires you to keep digital records and submit quarterly updates to HMRC, replacing the traditional annual <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/self-assessment\/\">Self Assessment tax return<\/a>.<\/p>\n\n\n\n<p>Here&#8217;s who it applies to, and when:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>From April 2026 (2026\/27 tax year):<\/strong> Self-employed individuals and landlords with gross income over <strong>\u00a350,000<\/strong><\/li>\n\n\n\n<li><strong>From April 2027 (2027\/28 tax year):<\/strong> Self-employed individuals and landlords with gross income over <strong>\u00a330,000<\/strong><\/li>\n\n\n\n<li><strong>From April 2028 (2028\/29 tax year):<\/strong> Self-employed individuals and landlords with gross income over <strong>\u00a320,000<\/strong><\/li>\n\n\n\n<li><strong>General partnerships:<\/strong> Timeline to be confirmed by HMRC<\/li>\n<\/ul>\n\n\n\n<p>A few important points:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The \u00a350,000 and \u00a330,000 thresholds refer to your <strong>gross income from self-employment or property<\/strong>, not your total income from all sources.<\/li>\n\n\n\n<li>Making Tax Digital for Income Tax applies to <strong>Self Assessment taxpayers<\/strong>, not <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/paye\/\">PAYE<\/a>-only <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/employee\/\">employees<\/a>. If your only income is from an employer, you don&#8217;t need to worry about this.<\/li>\n<\/ul>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-cta-mini m-blue m-align-left\">\n    \n    <div class=\"b-cta-mini__content\">\n\n        \n        <h2 class=\"b-cta-mini__title\">Am I affected by MTD?<\/h2>\n\n        \n        \n        <div class=\"b-cta-mini__body\">\n            <div class=\"b-block-body\"><ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Do you earn income from self-employment or property rental?<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Is your combined self-employment and rental income in the 2024\/25 tax year was over \u00a350,000?<\/span><\/li>\n<\/ul>\n<div class=\"c-trustpilot-widget m-mobile-center\" data-hook=\"js-testimonials\"><div class=\"trustpilot-widget\" data-locale=\"en-GB\" data-template-id=\"5419b637fa0340045cd0c936\" data-businessunit-id=\"68c038c6e21d291852a4d4cb\" data-style-height=\"20px\" data-style-width=\"240px\" data-theme=\"light\"><\/div><\/div>\n<\/div>\n        <\/div>\n\n        \n        \n        <div class=\"b-cta-mini__action\">\n\n            <a href=\"https:\/\/taxfix.com\/en-uk\/assessment\/mtd\/eligibility#incomeSources\" class=\"c-button m-large  m-mobile-fullwidth\">Try our Elegibility Checker<\/a>\n\n\n        <\/div>\n\n        \n    <\/div>\n<\/div> <!-- .b-cta-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>When does Making Tax Digital for Income Tax start?<\/strong><\/h2>\n\n\n\n<p>MTD has been rolling out gradually. Here&#8217;s a summary of the key dates:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Date<\/strong><\/td><td><strong>What happened \/ what&#8217;s coming<\/strong><\/td><\/tr><tr><td>April 2019<\/td><td>MTD for VAT launched for businesses above the VAT threshold<\/td><\/tr><tr><td>April 2022<\/td><td>MTD for VAT extended to all VAT-registered businesses<\/td><\/tr><tr><td><strong>April 2026<\/strong><\/td><td><strong>Making Tax Digital for Income Tax starts for income over \u00a350,000<\/strong><\/td><\/tr><tr><td>April 2027<\/td><td>MTD for Income Tax extends to income over \u00a330,000<\/td><\/tr><tr><td>April 2028<\/td><td>MTD for Income Tax planned to extend to income over \u00a320,000<\/td><\/tr><tr><td>TBC<\/td><td>General partnerships, date to be confirmed by HMRC<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>These dates refer to the start of the tax year (6 April), so April 2026 means the <strong>2026\/27 tax year<\/strong>. HMRC may update these timelines, so it&#8217;s always worth checking the<a href=\"https:\/\/www.gov.uk\/government\/publications\/making-tax-digital\"> latest GOV.UK guidance<\/a>.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How does Making Tax Digital work?<\/strong><\/h2>\n\n\n\n<p>In practice, MTD for Income Tax changes your reporting from once a year to four times a year \u2013 plus a final wrap-up at the end. Here&#8217;s how it works, step by step:<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-nude m-align-left\">\n    <div class=\"b-block-body\">\n        <ol>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Keep digital records<\/b><span style=\"font-weight: 400;\"> using Making Tax Digital software throughout the year. This means logging your income and expenses as you go, rather than gathering everything in January.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Submit quarterly updates<\/b><span style=\"font-weight: 400;\"> to HMRC: a summary of your income and expenses for each three-month period. These are <\/span><i><span style=\"font-weight: 400;\">not<\/span><\/i><span style=\"font-weight: 400;\"> tax payments; they&#8217;re just updates to keep HMRC informed.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>File an End of Period Statement (EOPS)<\/b><span style=\"font-weight: 400;\"> after the tax year ends. This confirms your figures for the year and includes any adjustments.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Submit a final declaration<\/b><span style=\"font-weight: 400;\"> through your MTD software. This replaces the traditional Self Assessment tax return (<\/span><a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/sa100-hmrc-form\/\"><span style=\"font-weight: 400;\">SA100<\/span><\/a><span style=\"font-weight: 400;\">) and confirms your total income from all sources.<\/span><\/li>\n<\/ol>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<p>Check out our <a href=\"https:\/\/taxfix.com\/en-uk\/general-tax-return-guides\/the-making-tax-digital-mtd-timeline\/\">Making Tax Digital Timeline<\/a> for a full overview of when you\u2019ll need to submit your quarterly filings and Final Declaration.<\/p>\n\n\n\n<p><strong>Important:<\/strong> MTD does not change how much tax you pay or when you pay it. You&#8217;ll still pay tax via Self Assessment through <a href=\"https:\/\/taxfix.com\/en-uk\/self-assessment-basics\/what-is-a-payment-on-account\/\">payments on account<\/a> and a <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/balancing-payment\/\">balancing payment<\/a> as you do now.<\/p>\n\n\n\n<p><strong>One genuine benefit:<\/strong> because your software is connected to HMRC, you&#8217;ll be able to see an estimate of your tax bill throughout the year. No more nasty surprises in January.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What software do I need for Making Tax Digital?<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>MTD-compatible software<\/strong><\/h3>\n\n\n\n<p>You&#8217;ll need to use software that&#8217;s been approved by HMRC for Making Tax Digital. This software must be able to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Keep digital records of your income and expenses<\/li>\n\n\n\n<li>Submit quarterly updates directly to HMRC<\/li>\n\n\n\n<li>File your End of Period Statement and final declaration<\/li>\n<\/ul>\n\n\n\n<p>HMRC maintains a full list of<a href=\"https:\/\/www.gov.uk\/guidance\/find-software-thats-compatible-with-making-tax-digital-for-income-tax\"> approved Making Tax Digital software<\/a>. Options range from Making Tax Digital free software (suitable for very straightforward cases) to paid platforms with more advanced features.<\/p>\n\n\n\n<p>Taxfix is a Making Tax Digital-compliant platform that connects you with UK-qualified <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/accountant\/\">accountants<\/a> and gives you simple digital tools to manage your quarterly updates and final declaration \u2013 without needing any accounting knowledge.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Can you use Excel or spreadsheets for MTD?<\/strong><\/h3>\n\n\n\n<p>This is one of the most common questions, and the answer is: not directly.<\/p>\n\n\n\n<p>You <strong>cannot<\/strong> submit quarterly updates to HMRC straight from Excel or Google Sheets. However, you <em>can<\/em> use a <a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/can-you-use-excel-for-making-tax-digital\/\">spreadsheet for your record-keeping<\/a>, as long as you connect it to HMRC via <strong>bridging software<\/strong> \u2013 a separate tool that acts as the link between your spreadsheet and HMRC&#8217;s systems.<\/p>\n\n\n\n<p>That said, bridging software adds an extra layer of complexity. Most sole traders and landlords find it simpler and less error-prone to use dedicated <a href=\"https:\/\/taxfix.com\/en-uk\/making-tax-digital\/\">Making Tax Digital software<\/a> from the start.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Is there free MTD software?<\/strong><\/h3>\n\n\n\n<p>Yes, HMRC&#8217;s approved software list includes free options, which may suit sole traders and landlords with straightforward tax affairs. Free software typically covers the basics: digital record-keeping and quarterly submissions.<\/p>\n\n\n\n<p>Paid software tends to offer more features such as bank feed integration, receipt scanning, expense categorisation, and multi-user access. The right choice depends on how complex your finances are.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Who is exempt from Making Tax Digital?<\/strong><\/h2>\n\n\n\n<p>Not everyone will need to comply with MTD for Income Tax. HMRC recognises that digital filing isn&#8217;t possible for everyone. You may be eligible for an exemption if:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Your income is <strong>below the threshold<\/strong> (\u00a350,000 from April 2026, dropping to \u00a330,000 from April 2027)<\/li>\n\n\n\n<li>You&#8217;re a <strong>PAYE-only employee<\/strong> with no Self Assessment obligation<\/li>\n\n\n\n<li>You&#8217;re <strong>digitally excluded<\/strong>, for example, due to age, disability, or religious beliefs that prevent you from using digital tools<\/li>\n\n\n\n<li>You live in a <strong>remote area<\/strong> without reliable internet access<\/li>\n\n\n\n<li>HMRC has granted you a <strong>specific exemption<\/strong> for another reason<\/li>\n<\/ul>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-purple m-align-left\">\n    <div class=\"b-block-body\">\n        <p><b>Exemptions are not automatic.<\/b><span style=\"font-weight: 400;\"> You&#8217;ll need to apply to HMRC and explain your circumstances. If you think you might qualify, check the<\/span><a href=\"https:\/\/www.gov.uk\/guidance\/check-if-you-can-get-an-exemption-from-making-tax-digital-for-income-tax\"> <span style=\"font-weight: 400;\">HMRC exemption guidance on GOV.<\/span><\/a><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What are the Making Tax Digital penalties?<\/strong><\/h2>\n\n\n\n<p>Missing <a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/is-there-a-making-tax-digital-mtd-deadline\/\">MTD deadlines<\/a> or failing to keep proper digital records can result in <a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/making-tax-digital-penalties\/\">penalties<\/a>. Here&#8217;s what to be aware of:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Failing to keep digital records<\/strong>: HMRC can issue a penalty for not maintaining records in the required digital format<\/li>\n\n\n\n<li><strong>Missing a quarterly update deadline<\/strong>: <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/late-filing-penalty\/\">late submissions<\/a> can attract penalty points under HMRC&#8217;s points-based system<\/li>\n\n\n\n<li><strong>Submitting inaccurate information<\/strong>: penalties may apply if errors are found in your updates or final declaration<\/li>\n\n\n\n<li><strong>Missing the End of Period Statement or final declaration deadline<\/strong>: similar to existing Self Assessment late filing penalties<\/li>\n<\/ul>\n\n\n\n<p>HMRC has indicated it intends to take a light-touch approach in the first year of Making Tax Digital for Income Tax (the 2026\/27 tax year), focusing on helping taxpayers adapt rather than issuing penalties immediately. However, this has not been confirmed as official policy, so it&#8217;s best not to rely on it.<\/p>\n\n\n\n<p>Under the existing Self Assessment penalty regime, a late filing penalty starts at <strong>\u00a3100<\/strong>, with escalating charges the longer a return remains outstanding. MTD penalties start at \u00a3200 once a threshold of four penalty points is reached, with another \u00a3200 penalty each time you miss another submission deadline. Fortunately, you can only get one penalty point per deadline.<\/p>\n\n\n\n<p>The good news? The new points-based penalty system for MTD is actually designed to be fairer than the current one. The occasional slip-up won&#8217;t automatically trigger a fine.<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-blue m-align-left\">\n    <div class=\"b-block-body\">\n        <p><span style=\"font-weight: 400;\">Running late on your return? See what costs you may incur with our <\/span><a href=\"https:\/\/taxfix.com\/en-uk\/calculator\/late-tax-return-penalties\/\"><span style=\"font-weight: 400;\">late tax return penalty calculator<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>&nbsp;How to register for Making Tax Digital<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 1: Check if you need to register<\/strong><\/h3>\n\n\n\n<p>Work out whether Making Tax Digital for Income Tax applies to you. If your gross income from self-employment or property is over \u00a350,000, you&#8217;ll need to be compliant from the 2026\/27 tax year (starting April 2026). If it&#8217;s over \u00a330,000, you&#8217;ll need to comply from April 2027.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 2: Choose MTD-compatible software<\/strong><\/h3>\n\n\n\n<p>Pick a Making Tax Digital software provider from HMRC&#8217;s approved list. Make sure it can handle quarterly updates, the End of Period Statement, and your final declaration.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 3: Sign up for MTD via HMRC<\/strong><\/h3>\n\n\n\n<p>You&#8217;ll need to sign up through your <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/hmrc-online-services\/\">HMRC online account<\/a>. HMRC will confirm your registration and give you a start date for your first quarterly update. You can find step-by-step sign-up guidance on<a href=\"https:\/\/www.gov.uk\/guidance\/sign-up-your-business-for-making-tax-digital-for-income-tax\"> GOV.UK<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 4: Start keeping digital records<\/strong><\/h3>\n\n\n\n<p>Once you&#8217;re registered, begin logging your income and <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/expenses\/\">expenses<\/a> digitally from the start of your MTD period. Don&#8217;t wait! The sooner you get into the habit, the easier it&#8217;ll be.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Making Tax Digital for different taxpayer groups<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Making Tax Digital for self-employed and sole traders<\/strong><\/h3>\n\n\n\n<p>If you&#8217;re self-employed or a sole trader with gross business income over \u00a350,000, Making Tax Digital for Income Tax applies to you from April 2026. You&#8217;ll need to keep digital records of your business income and <a href=\"https:\/\/taxfix.com\/en-uk\/self-employed-tax-returns\/self-employed-claimable-expenses\/\">expenses<\/a>, submit four quarterly updates each year, and file a final declaration instead of a traditional Self Assessment return.<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-blue m-align-left\">\n    <div class=\"b-block-body\">\n        <p><span style=\"font-weight: 400;\">\ud83d\udc49 <\/span><i><span style=\"font-weight: 400;\">Find out more:<\/span><\/i><a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/what-does-making-tax-digital-mean-for-self-employed\/\"> <i><span style=\"font-weight: 400;\">Making Tax Digital <\/span><\/i><i><span style=\"font-weight: 400;\">for self-em<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">ployed<\/span><\/i> <i><span style=\"font-weight: 400;\">|<\/span><\/i><a href=\"https:\/\/taxfix.com\/en-uk\/mtd-sole-traders\"> <i><span style=\"font-weight: 400;\">MTD for sole traders<\/span><\/i><\/a><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Making Tax Digital for landlords<\/strong><\/h3>\n\n\n\n<p>Landlords with UK property income over \u00a350,000 are also in scope from April 2026. This applies to both residential and commercial property income. You&#8217;ll follow the same process as self-employed taxpayers: digital records, quarterly updates, and a final declaration.<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-blue m-align-left\">\n    <div class=\"b-block-body\">\n        <p><span style=\"font-weight: 400;\">\ud83d\udc49 <\/span><i><span style=\"font-weight: 400;\">Find out more:<\/span><\/i><a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/everything-to-know-about-making-tax-digital-for-landlords\/\"> <i><span style=\"font-weight: 400;\">Making Tax Digital for landlords<\/span><\/i><\/a><span style=\"font-weight: 400;\"> | <\/span><a href=\"https:\/\/taxfix.com\/en-uk\/calculator\/rental-income-tax\/\"><span style=\"font-weight: 400;\">Rental income tax calculator<\/span><\/a><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Making Tax Digital for individuals (general Self Assessment)<\/strong><\/h3>\n\n\n\n<p>MTD for Income Tax is currently focused on business and property income. If you file Self Assessment for other reasons, such as <a href=\"https:\/\/taxfix.com\/en-uk\/high-earner-tax-returns\/what-are-the-tax-implications-of-earning-over-100k\/\">high income<\/a>, <a href=\"https:\/\/taxfix.com\/en-uk\/investor-capital-gains-tax-returns\/trading\/how-much-is-tax-on-investment-income\/\">investment income<\/a>, or <a href=\"https:\/\/taxfix.com\/en-uk\/the-tax-basics\/how-to-pay-tax-on-your-foreign-income\/\">foreign income<\/a>, MTD may still apply to you if you <em>also<\/em> have self-employment or property income above the threshold. If your Self Assessment obligation is purely for non-business income, you&#8217;re not currently in scope.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How Taxfix can help with Making Tax Digital<\/strong><\/h2>\n\n\n\n<p>Getting your head around MTD can feel overwhelming \u2013 but it doesn&#8217;t have to be. Taxfix is designed to make the whole process straightforward, even if you&#8217;ve never used <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/accounting-software\/\">accounting software<\/a> before.<\/p>\n\n\n\n<p>Here&#8217;s what you get with Taxfix:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Making Tax Digital-compliant software<\/strong>: approved and ready for quarterly submissions<\/li>\n\n\n\n<li><strong>Simple, user-friendly interface<\/strong>: no accounting knowledge needed<\/li>\n\n\n\n<li><strong>Automated quarterly updates<\/strong>: so you never miss a deadline<\/li>\n\n\n\n<li><strong>Expense tracking<\/strong>: log costs as you go, throughout the year<\/li>\n\n\n\n<li><strong>Final declaration filing<\/strong>: we handle the end-of-year wrap-up, too<\/li>\n\n\n\n<li><strong>Accountant-led support<\/strong>: <a href=\"https:\/\/taxfix.com\/en-uk\/the-tax-basics\/what-is-a-self-assessment-accountant\/\">UK-qualified tax accountants<\/a> on hand when you need them<\/li>\n\n\n\n<li><strong>Transparent, affordable pricing<\/strong>: with your first month free<\/li>\n<\/ul>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-blue m-align-left\">\n    <div class=\"b-block-body\">\n        <p><b>Ready to get MTD-ready? <\/b><a href=\"https:\/\/taxfix.com\/en-uk\/mtd-for-itsa\/\"><span style=\"font-weight: 400;\">Get started with Taxfix today <\/span><\/a><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Frequently asked questions about Making Tax Digital<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>When does Making Tax Digital start for Self Assessment?<\/strong><\/h3>\n\n\n\n<p>Making Tax Digital for Income Tax starts in April 2026 for self-employed individuals and landlords with gross income over \u00a350,000. It extends to those with an income over \u00a330,000 from April 2027.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Will Making Tax Digital replace Self Assessment?<\/strong><\/h3>\n\n\n\n<p>MTD for Income Tax replaces the traditional annual Self Assessment tax return (<a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/sa100-hmrc-form\/\">SA100<\/a>) for those in scope. Instead, you&#8217;ll submit quarterly updates and a final declaration through Making Tax Digital software. You&#8217;ll still pay tax through the Self Assessment payment system.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How much does Making Tax Digital cost?<\/strong><\/h3>\n\n\n\n<p>The cost depends on the software you choose. Free options exist for straightforward cases. Paid platforms, like Taxfix, offer more features and accountant support, typically for a monthly or annual fee. Check individual providers for current pricing.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>What happens if I miss a quarterly MTD deadline?<\/strong><\/h3>\n\n\n\n<p>Under HMRC&#8217;s points-based penalty system, missing a deadline earns you a penalty point. Once you accumulate enough points, a financial penalty is triggered. HMRC has indicated a light-touch approach in the first year of MTD for Income Tax, but it&#8217;s still best to stay on top of your deadlines.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Can I opt out of Making Tax Digital?<\/strong><\/h3>\n\n\n\n<p>No. If Making Tax Digital for Income Tax applies to you, it&#8217;s mandatory. The only way to avoid it is if you qualify for an official HMRC exemption. You can <a href=\"https:\/\/www.gov.uk\/contact-hmrc\">contact HMRC<\/a> by phone or in writing to request an exemption. HMRC will assess your circumstances and confirm whether you qualify.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Do I need to register for MTD if I&#8217;m already registered for Self Assessment?<\/strong><\/h3>\n\n\n\n<p>Yes. Being registered for Self Assessment doesn&#8217;t automatically enrol you in MTD for Income Tax. You&#8217;ll need to <a href=\"https:\/\/taxfix.com\/en-uk\/tax-changes\/how-do-i-sign-up-for-mtd-with-hmrc\/\">sign up separately<\/a> through your HMRC online account.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Will MTD change how much tax I pay?<\/strong><\/h3>\n\n\n\n<p>No. MTD changes how you <strong>report<\/strong> your income, not how much tax you owe. Your tax liability is calculated in the same way as before.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>What&#8217;s the difference between MTD for VAT and MTD for Income Tax?<\/strong><\/h3>\n\n\n\n<p>MTD for VAT applies to VAT-registered businesses and requires digital VAT record-keeping and online <a href=\"https:\/\/taxfix.com\/en-uk\/limited-companies\/file-a-vat-return\/\">VAT return<\/a> submissions. Making Tax Digital for Income Tax applies to self-employed individuals and landlords, requiring quarterly income and expense updates and a final declaration instead of an annual Self Assessment return. A <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/sole-trader\/\">sole trader<\/a> can be subject to both.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Can my accountant submit MTD updates on my behalf?<\/strong><\/h3>\n\n\n\n<p>Yes. You can authorise an accountant or tax agent to manage your MTD submissions for you. They&#8217;ll need to be <a href=\"https:\/\/taxfix.com\/en-uk\/glossary\/form-64-8\/\">registered as your agent with HMRC<\/a>.<\/p>\n\n\n<\/div> <!-- .c-body -->\n\n<div class=\"b-highlight-mini m-nude m-align-left\">\n    <div class=\"b-block-body\">\n        <p><i><span style=\"font-weight: 400;\">This article provides general information only and is not personalised tax advice.<\/span><\/i><\/p>\n\n    <\/div>\n<\/div> <!-- .b-highlight-mini -->\n\n<div class=\"c-body\">\n\n","protected":false},"excerpt":{"rendered":"<p>Making Tax Digital, or MTD, is HMRC&#8217;s plan to move the UK tax system online. Instead of filing one tax return at the end of the year, you&#8217;ll keep digital records and send regular updates to HMRC throughout the year using approved software. It&#8217;s a big shift, but the goal is to make tax simpler, [&hellip;]<\/p>\n","protected":false},"author":62,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[469,466],"tags":[102,476],"class_list":["post-46624","post","type-post","status-publish","format-standard","hentry","category-making-tax-digital-mtd","category-tax-changes","tag-hmrc","tag-making-tax-digital"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What does Making Tax Digital (MTD) mean? | Taxfix<\/title>\n<meta name=\"description\" content=\"Making Tax Digital for Income Tax is changing how sole traders and landlords report to HMRC. 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