Are You Ready for Making Tax Digital for Income Tax?

From April 2026, Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) will be the biggest shift in the UK’s tax system in decades and if you’re a local landlord or self-employed business owner, this change will affect how you manage your taxes.

Let’s help demystify what’s changing, who it affects and how to prepare – so you can stay compliant and in control.

Firstly, What is Making Tax Digital for Income Tax?

MTD for ITSA is HMRC’s next step in its digital overhaul of the UK tax system. If you remember the move to MTD for VAT, this is a similar concept – but now it applies to individuals rather than businesses.

Under the new rules, you’ll need to:

• Keep digital records of your income and expenses
• Submit quarterly updates to HMRC using approved software
• File an End of Period Statement (EOPS) and a Final Declaration annually

Gone are the days of one Self Assessment tax return a year – this is all about more frequent reporting and full digitisation.

Here’s how it will look:

Quarterly period*	Deadline for quarterly submission
6 April to 5 July	7 August
6 July to 5 October	7 November
6 October to 5 January	7 February
6 January to 5 April	7 May

*You can choose to use the month end e.g. 30 June rather than 5 July but the deadline for submission remains the same.

Who Will Be Affected?

From April 2026, MTD for ITSA will apply to:

• Self-employed individuals and landlords
• With a combined income of £50,000 or more

In April 2027, those earning over £30,000 will be brought into the fold.

If you earn under £30,000 or use a partnership structure, MTD for ITSA won’t apply just yet – but that could change in future phases. Also, just note ‘Income’ relates to sales and not profits.

What Will Change in Practice?

Let’s say you’re a local graphic designer or a property owner,  right now, you may do your bookkeeping manually or submit your Self Assessment once a year, often close to the deadline.

With MTD, you’ll need to:

1. Use MTD-compatible software to track income and expenses (think Xero, QuickBooks, or FreeAgent)
2. Submit quarterly updates – even if you’ve had no income that period
3. At year-end, review your data, make final adjustments, and send your Final Declaration – replacing your traditional tax return

Why This Matters Locally

Many of our local clients are brilliant at what they do – from trades and freelancers to small-scale landlords – but not everyone is confident with digital tools. That’s why we’re encouraging local businesses to start preparing now.

The earlier you adopt digital record-keeping and quarterly reporting, the smoother your transition will be. You’ll also get a clearer view of your tax position throughout the year – no more January panic.

What You Should Do Now

Here are 3 simple steps to get ahead:

1. Check if you’re affected: Look at your last tax return – if your property and/or self-employed income tops £50,000, you’ll be in scope for 2026.
2. Go digital early: Start using accounting software now. This gives you time to learn the ropes and spot any hiccups.
3. Speak to a local accountant: We can guide you through the setup, help you choose the right software, and make sure you’re fully compliant.

Always Here to Help

We’re already helping clients across Cheshire, Manchester, Huddersfield and Yorkshire get MTD-ready. Whether you’re a seasoned business owner or just starting out, we’ll help you stay on the right side of the rules – and make the most of the transition.