Do I need to use Making Tax Digital for Income Tax?

If you are a sole trader or landlord registered for Self Assessment and your combined turnover from self-employment and property is over the threshold for your year, you have to use Making Tax Digital for Income Tax.

You need to use Making Tax Digital for Income Tax if all of these are true:

you are a sole trader or a landlord registered for Self Assessment
you get income from self-employment or property, or both
your qualifying income is more than the threshold for your year

Qualifying income is your total income from self-employment and property before you take any expenses off. It is turnover, not profit. So a landlord with £55,000 of rent coming in and £40,000 of costs going out is over the £50,000 threshold, even though the profit is nowhere near it.

The thresholds and the dates

There are three stages. Each one is triggered by your qualifying income in a specific tax year, which is not the year you start.

Your qualifying income	In this tax year	You must use Making Tax Digital from
Over £50,000	2024 to 2025	6 April 2026
Over £30,000	2025 to 2026	6 April 2027
Over £20,000	2026 to 2027	6 April 2028

The first stage is already live. If your qualifying income was over £50,000 in the 2024 to 2025 tax year, you have been in Making Tax Digital for Income Tax since 6 April 2026. Your first update period for the 2026 to 2027 tax year ran from 6 April to 5 July 2026, and the deadline to send that update is 7 August 2026.

HMRC looks at an earlier year, not the one you are in

This is the part people get wrong, so it is worth being slow about.

HMRC works out your qualifying income from the Self Assessment tax return you submitted for the tax year in the middle column of the table above. It does not look at how you are trading now.

For the April 2026 group, that means the 2024 to 2025 tax return. Your income in 2025 to 2026 does not decide whether you join in April 2026, and neither does your income in 2026 to 2027. If the 2024 to 2025 figure was over £50,000, you are in, even if you have since had a quieter year.

The same logic runs down the line. The April 2027 group is decided on the 2025 to 2026 return, which is due online by 11:59pm on 31 January 2027. The April 2028 group is decided on the 2026 to 2027 return.

What counts towards qualifying income

You add together the gross figures, before expenses, from every self-employment and every property you have. HMRC's own worked example is £25,000 of rental income plus £27,000 of self-employment income, giving qualifying income of £52,000. Neither source is over £50,000 on its own, but the total is, so that person is in.

Qualifying income includes:

self-employment turnover
UK property income, and foreign property income if you are UK tax resident
your share of income from jointly owned property
income from bare trusts and interest in possession trusts

It does not include employment income taxed through PAYE, dividends, the State Pension, private pensions, or your share of profits as a partner in a partnership. If most of your money comes from a salary and you have a small amount of rent on the side, only the rent counts.

If your accounting period is shorter than 12 months, HMRC will annualise your self-employment figure where it has the information to do so. For property income you need to annualise it yourself. There is more detail in what counts as qualifying income.

How HMRC tells you

HMRC reviews your Self Assessment tax return and checks your qualifying income each tax year. If you are above the threshold, HMRC writes to you to confirm that you need to start using Making Tax Digital for Income Tax.

Do not treat the letter as the trigger. HMRC is explicit that if you do not receive a letter, it is still your responsibility to check whether and when you need to use Making Tax Digital for Income Tax. Letters go astray, addresses go out of date, and the obligation sits with you either way. Take ten minutes with your last return and add up the turnover boxes.

What to do if you are close to a threshold

If your qualifying income is near the line, work it out properly rather than rounding in your favour. Remember it is turnover before expenses, and it is every business and every property added together.

If you land just under, you are not in for that stage, but the thresholds keep dropping. Someone with £35,000 of qualifying income in the 2025 to 2026 tax year misses the £50,000 stage entirely, but joins at the £30,000 stage from 6 April 2027. If you are close to one threshold, it is worth checking the next one too rather than preparing twice.

You can sign up before you are required to. To sign up you must be registered for Self Assessment and have submitted a tax return in the last 2 years.

Who is out of scope

Some people are not covered at all.

Limited companies. Making Tax Digital for Income Tax does not apply to limited companies. If you run your business through a company, the company's own profits are outside it. You might already use Making Tax Digital for VAT if the company is VAT registered, but that is a separate thing.

Partnerships. Partnerships do not currently need to use Making Tax Digital for Income Tax. HMRC has said they will need to in future and that the timeline will be set out at a later date. Your share of partnership profits also does not count towards your personal qualifying income.

Trusts and estates. Trusts that submit an SA900 return, including charitable trusts, are outside it, as are personal representatives dealing with the affairs of someone who has died.

Anyone with qualifying income of £20,000 or less. HMRC treats this as a permanent exemption. If you stay at or below £20,000, you do not need to use Making Tax Digital for Income Tax unless your circumstances change.

New businesses, until your first return is in. You do not need to start using Making Tax Digital for Income Tax until after you have submitted your first Self Assessment tax return.

There are further exemptions, including for people who are digitally excluded because their age, health condition or disability stops them using a computer, tablet or smartphone, because of religious belief, or because they cannot get internet access at their home or business due to their location. Some groups also have a time-limited exemption. See Making Tax Digital exemptions for the detail, or apply through HMRC.

What being in it actually means

Once you are in, you keep your income and expense records digitally and send HMRC an update every 3 months for each self-employment and property business you have, through compatible software, rather than reporting everything once a year. Each update is a set of totals for the income and expense categories you use. HMRC does not receive your individual receipts or invoices.

You still submit a tax return at the end of the tax year, by 31 January following the end of that tax year. The difference is that you complete and submit it through your Making Tax Digital software. See quarterly update deadlines and do I still file a Self Assessment tax return.

MTD Gateway keeps those digital records and sends the in-year quarterly updates for self-employment and UK property. It does not submit the end of year tax return, so you will need to finish the tax year elsewhere.

If your income drops later

Being in Making Tax Digital for Income Tax is not necessarily permanent. Once you are using the service, if your qualifying income drops below the relevant threshold for 3 tax years in a row, you can choose to opt out and go back to submitting a Self Assessment tax return. HMRC uses the income in your fourth quarterly update to confirm the third of those years.

Until you actually opt out, you carry on. One bad year does not release you, and you should keep sending updates while the position is being worked out.

Last reviewed 25 July 2026. This is general information about how Making Tax Digital works, not tax advice. We are not accountants. If your situation is complicated, speak to one, or check the guidance on GOV.UK.