As you might be aware, HMRC will roll out the first phase of Making Tax Digital for Income Tax (MTD) next year, the latest step in the government’s plan to modernise the UK tax system.

 

From April 2026, sole traders and landlords with an annual turnover above £50,000 will need to comply with new regulations, including keeping digital records and submitting quarterly updates to HMRC using MTD-compatible software.

 

From April 2027, the changes will be introduced for those with an income over £30,000.

 

You can read more about how MTD will change self-assessment here

 

If you have not already, you should soon receive a letter from HMRC confirming that you will be included in the initial roll-out next year.

 

Getting Started

 

The regulations come into effect in April 2026. It is important to prepare early so you have time to start using digital tools and understand what is required. This includes making sure you are set up with MTD-compatible software.

 

How will we support you

 

We can support you in complying with the obligations by preparing and submitting the quarterly updates to HMRC using a compatible software.

 

We will need you to provide the relevant information and accounting records to us in a timely manner each quarter, to give us enough time to process the information into the format that HMRC require.

 

If you would like us to assist you with meeting the upcoming HMRC reporting obligations, please let us know and we can provide you with more details of the information we need each quarter, as well as an estimate on our costs for this work.

 

If you are planning on submitting the quarterly updates to HMRC yourself, please also let us know as there will still be an initial requirement for us to set up your registration for MTD with HMRC.

 

If you are planning on undertaking the quarterly updates yourself, we will be on hand to assist with any queries you may have.

 

What is next

 

If we are already completing MTD VAT returns, the additional requirements of MTD for income tax will be a relatively small change to how we are currently supporting you.

 

However, if you are new to quarterly reporting then now is the time to consider how you currently maintain your records and their suitability for the requirements of MTD and understand the additional record keeping and reporting obligations involved, along with the new quarterly submission deadlines.   

 

If you would like to discuss this matter, please contact us as soon as possible by contacting our MTD team on 01509 622830 or email tax@rwpaccountants.co.uk so we can start the process of supporting you on this matter.

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