Government announces timetable for Self Assessment taxpayers to prepare for Making Tax Digital

Making Tax Digital (MTD) compatible software will be mandatory for Income Tax Self Assessment taxpayers from April 2026.

Self-employed individuals and landlords with earnings over £50,000 will need to keep digital records of income and expenses, and make quarterly updates to HMRC from April 2026. Those with earnings between £30,000 and £50,000 will have until April 2027 to switch to an MTD-compatible accounting software. Most customers will be able to join voluntarily beforehand meaning they can eliminate common errors and save time managing their tax affairs.

A review has also been announced into the needs of smaller businesses below the £30,000 income threshold to consider how MTD for Income Tax Self Assessment can be shaped to meet their needs.

Mandation of MTD for self assessment taxpayers had previously been expected to begin from April 2024, but has been delayed to give those affected more time to prepare in light of the current challenging economic circumstances.

Victoria Atkins, Financial Secretary to the Treasury, said:

“It is right to take the time to work together to maximise the benefits of Making Tax Digital for small businesses by implementing the change gradually. It is important to ensure this works for everyone: taxpayers, tax agents, software developers, as well as HMRC.

“Smaller businesses in particular should be able to experience the benefits of increased digitalisation of Income Tax in a way which meets their needs. That is why we are also today announcing a review to establish the best way to achieve this.”

Jim Harra, Chief Executive and First Permanent Secretary, HM Revenue and Customs, said:

“HMRC remains committed to the delivery of Making Tax Digital as a critical part of our strategy for digitalising and modernising the tax system, but we want to make sure we get this right and deliver it effectively.

“A phased approach to mandating MTD for Income Tax will allow us to work together with our partners to make sure that our self-employed and landlord customers can make the most of the opportunities this will bring.