What Is MTD IT and How Will It Affect Self-Employed Individuals & Landlords?
What Is Making Tax Digital for Income Tax and How Will It Affect Self‑Employed People and Landlords?
Making Tax Digital for Income Tax is a big change to how self‑employed people and landlords in the UK report their earnings to HMRC. It’s part of the government’s plan to make tax easier and more accurate by using digital tools.
If you’re self‑employed or you rent out property, this could affect how you keep your records and file your tax returns. Here’s what you need to know.
What Is Making Tax Digital for Income Tax?
Making Tax Digital for Income Tax is part of the wider Making Tax Digital programme. It already applies to VAT, and now it’s being rolled out to income tax.
If you’re self‑employed or a landlord, you’ll need to:
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Keep digital records of your income and expenses
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Send quarterly updates to HMRC using approved software
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Submit an End of Period Statement and a Final Declaration at the end of the tax year
Who Does It Apply To?
Making Tax Digital for Income Tax will be introduced in stages, based on your annual income from self-employment or property:
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From April 2026: If your income is over £50,000
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From April 2027: If your income is over £30,000
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From April 2028 (expected): If your income is over £20,000
This applies to your total income from both self-employment and property.
What Will Change for You?
1. Digital Record‑Keeping
Paper records or basic spreadsheets won’t be enough anymore. You’ll need to use software that is compatible with Making Tax Digital to keep track of your business or rental income and expenses.
2. Quarterly Updates
Instead of sending one tax return a year, you’ll submit updates every three months. These updates give HMRC a summary of your income and expenses.
3. End of Year Submissions
At the end of the tax year, you’ll review your information and send an End of Period Statement and a Final Declaration to confirm your total income and tax due.
4. More Regular Insights
With updates throughout the year, you’ll have a clearer idea of what you owe in tax. This can help you budget better and avoid surprises at the end of the year.
What Should You Do to Get Ready?
1. Check When It Applies to You
Look at your total income from self-employment and rental properties to find out when you need to follow the new rules.
2. Choose MTD-Compatible Software
There are many software options available that are approved for Making Tax Digital. These tools will help you manage your records and send the required updates.
3. Go Digital with Your Records
Start moving your paperwork into a digital system now. Scan receipts, log income and expenses regularly, and keep everything up to date.
4. Learn the New Process
Make sure you understand what’s expected, from quarterly updates to year‑end submissions. If you use an accountant, they can help explain everything.
5. Get Professional Help if Needed
Switching to digital reporting can feel like a big step. An experienced bookkeeper or accountant can guide you through it and make sure everything is done right.
How Moore to Bookkeeping Can Help
At Moore to Bookkeeping, we help self‑employed people and landlords get ready for Making Tax Digital for Income Tax. We’ll make the process simple and stress-free.
Here’s what we offer:
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Clear Advice: We explain what the new rules mean for your business
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Software Setup: We help you choose, install, and learn to use the right software
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Quarterly Reporting: We assist with submitting your updates on time
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End-of-Year Submissions: We handle the final steps so you stay compliant
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Ongoing Support: We’re here when you have questions or need help
Get Ready for the Future of Tax
Making Tax Digital for Income Tax is coming and getting prepared early can save you time, stress, and possible penalties. At Moore to Bookkeeping, we’ll support you every step of the way.
