If you are a sole trader or landlord in the UK, the way you file tax changes on 6 April 2026. You will no longer file one Self Assessment return a year. Instead, if your qualifying income exceeds £50,000, you must keep digital records and send HMRC quarterly updates plus a final declaration — all through compatible software. The threshold drops to £30,000 in April 2027 and £20,000 in April 2028.
HMRC began writing to affected taxpayers in February 2026 based on 2024/25 returns. If you received that letter, you are in scope. If you did not but your gross self-employment or property income exceeded £50,000, you are still in scope. Here is the timeline and the workflow.
Who Is In Scope and When
Qualifying income is total gross income from self-employment plus property, before expenses, from the previous tax year.
- 6 April 2026: >£50,000 in 2024/25 ⇒ MTD for Income Tax from 2026/27
- 6 April 2027: >£30,000 in 2025/26 ⇒ in scope
- 6 April 2028: >£20,000 in 2026/27 ⇒ in scope
Partnerships and most other entities are not yet in scope; the mandate is for sole traders and landlords. Digital records and quarterly updates are required; the annual Self Assessment deadline remains 31 January, but the submissions are now quarterly.
What You Must Do
- Keep digital records of income and expenses in MTD-compatible software (Xero, QuickBooks, FreeAgent, and others are listed as compatible)
- Send quarterly updates to HMRC within the prescribed windows — the quarter is not altered by your accounting year; HMRC's quarters apply
- Submit an end-of-period statement and final declaration that replaces the old annual return
Penalties for late quarterly updates will mirror the points-based system already used for MTD for VAT. Start before April: categorize opening balances, connect bank feeds, and run a trial quarterly submission.
Simplify Your Financial Management
MTD turns annual bookkeeping into quarterly bookkeeping — the businesses that struggle are the ones whose records are already quarterly-behind. Beancount.io keeps digital, version-controlled records where every transaction is categorized and reconcilable before HMRC asks for the update. Get started for free and make your next quarterly update a submission, not a scramble.