MTD for Income Tax means digital records, quarterly updates and an annual return through compatible software. It applies in phases based on relevant gross self-employment and property income. It changes the reporting process; quarterly updates do not automatically mean quarterly tax payments.
Who starts when?
| Relevant qualifying income | Income year used | Start date |
|---|---|---|
| Over £50,000 | 2024/25 | 6 April 2026 |
| Over £30,000 | 2025/26 | 6 April 2027 |
| Over £20,000 | 2026/27 | 6 April 2028 |
Qualifying income is the relevant gross self-employment and property income before expenses, combined across the relevant sources. PAYE salary is not added to that threshold total. Check exemptions and special circumstances through HMRC rather than deciding from a bank balance.
What changes in practice?
You or your agent keep digital transaction records in a suitable system. Compatible software sends cumulative income and expense category totals to HMRC. After year-end you finalise the annual tax position and submit the return through compatible software. HMRC does not receive every invoice in a quarterly update.
Standard update dates
The standard periods run cumulatively from 6 April to 5 July, 5 October, 5 January and 5 April. The respective deadlines are 7 August, 7 November, 7 February and 7 May. Calendar periods have different coverage dates but the same deadlines. Select the correct basis before the first update is submitted.
What stays separate?
Quarterly reporting does not automatically introduce quarterly tax bills. Service fees, tax payments and payments on account are different. An earlier Self Assessment return can still be due: the usual 2025/26 online deadline is 31 January 2027, while the 2026/27 MTD annual return is due by 31 January 2028.
If you are behind
HMRC’s 2026/27 quarterly penalty-point relief does not make updates optional. Check signup status, outstanding updates and the digital records from the start of the year. Do not ignore the earlier annual return.
Start with qualifying income if eligibility is unclear. For the reporting task, use the update guide. If you prefer managed support, compare TaxSimba’s MTD packages and agree who keeps, checks and submits the records.
Separate setup from ongoing work
Illustrative preparation example.
A software subscription is active, but records are incomplete and no one has accepted the next filing. List signup, software authorisation, digital records, quarterly submissions and annual completion separately. That makes it easier to see whether the problem is access, bookkeeping or responsibility.
Check: Which part is ready, and which still has no named person responsible?
| Check | Practical action |
|---|---|
| Scope | Check qualifying income, start date and exemptions. |
| Records and updates | Agree a compatible workflow and reporting responsibilities. |
| Annual position | Plan the return and actual tax payment separately. |
Is MTD for VAT the same service?
No. The taxes, scope and reporting requirements differ. Do not assume an existing VAT setup covers Income Tax.
Can an accountant manage the process?
An appropriately authorised agent can undertake agreed work using compatible software. Confirm the role and service scope.
Download a checklist for this guide
- Qualifying-income assessment year
- Start date and exemptions to check
- Business and property sources
- Software or agent responsibilities
- Update, return and payment plan