Three quarters of eligible businesses still need to register for Making Tax Digital

HMRC’s rules state that sole traders and landlords with qualifying income over £50,000 must register to join Making Tax Digital (MTD) for income tax for the 2026/27 tax year. Qualifying income is measured based on income reported in the 2024/25 self-assessment tax return. Eligible taxpayers should have received a letter from HMRC after filing their return reminding them of this requirement, but registration is mandatory even if they don’t receive the letter.  

What is Making Tax Digital for income tax? 

MTD for income tax is a major change to income tax reporting. Currently sole traders and landlords must file a self-assessment tax return once a year with various options for doing so, and pay income tax via either one or two annual payments (depending on whether payments on account rules apply).  

Under MTD for income tax rules, businesses must use a bookkeeping software solution to file quarterly updates with HMRC, followed by an end of year tax return, which is also made via the software. Payments of income tax will not change and will still need to be made by the 31st January following the tax year end, plus 31st July if using payments on account. 

Quarterly updates are of income and expenses with no accounting adjustments made nor reliefs claimed.  

TaxAssist Accountants’ free webinar on how to choose Making Tax Digital software on Thursday, 23rd April 2026 discussed the importance of thinking your options through and choosing your software solution. A recording of the webinar will be available to watch here shortly.

What do eligible businesses need to do? 

If you are concerned that you should have registered for MTD for income tax for the 2026/27 tax year but are yet to do so, contact TaxAssist Accountants on 01535 601199 or using our contact form here to speak to an experienced and trusted accountant.  

Last updated: 23rd April 2026