MTD for Income Tax changes reporting cadence, not the underlying Income Tax calculation. The current rollout applies to qualifying self-employment and property income before expenses. Your software helps you create records and updates, but you remain responsible for meeting the annual tax-return and payment deadline.
Direct answer
From 6 April 2026, some sole traders and landlords must keep digital records, send quarterly updates and submit their annual tax return through compatible software. The first quarterly-update deadline is 7 August 2026.
- 2026/27 entry
- More than £50,000 qualifying income
- First update
- 7 August 2026
- Tax return and payment
- 31 January after the tax year
- First-year updates
- No quarterly-update penalty points
| Tax year | Entry condition | Key action | HMRC source |
|---|---|---|---|
| 2026/27 | More than £50,000 qualifying income; rollout begins 6 April 2026. | Keep digital records, send quarterly updates and submit the annual tax return through compatible software. | HMRC: MTD for Income Tax step by step |
| 2027/28 | More than £30,000 qualifying income; rollout begins 6 April 2027. | Keep digital records, send quarterly updates and submit the annual tax return through compatible software. | HMRC: MTD for Income Tax step by step |
| 2028/29 | More than £20,000 qualifying income; rollout begins 6 April 2028. | Keep digital records, send quarterly updates and submit the annual tax return through compatible software. | HMRC: MTD for Income Tax step by step |
| First 2026/27 update | The first deadline is 7 August 2026. | Send the update before submitting the annual tax return. | HMRC: send quarterly updates |
| 2026/27 quarterly updates | HMRC will not apply penalty points for late quarterly updates in the 2026/27 tax year. Penalties can still apply for late tax returns and late payments. | Do not treat the easement as a waiver of the update obligation. | HMRC: MTD Income Tax penalties |
Checklist
Quick checklist
- Check whether your qualifying income is above the threshold for your entry year.
- Use compatible software to keep digital records for each relevant self-employment and property business.
- Put the four quarterly-update deadlines and the 31 January annual deadline in your diary.
- Treat the 2026/27 quarterly-update penalty easement as time to establish a reliable process, not as permission to skip updates.
- Ask a qualified adviser about complex circumstances, exemptions, jointly held property or adjustments before filing.
Section 01
Who must use MTD for Income Tax
You need to use MTD for Income Tax when you are an individual registered for Self Assessment, receive income from self-employment or property, and your qualifying income is above the threshold for your entry year. Qualifying income is the combined self-employment and property income before expenses; it is not your profit and does not include every other type of income or gain.
The threshold is more than £50,000 for 2026/27, more than £30,000 for 2027/28 and more than £20,000 for 2028/29, subject to HMRC's current rules. Check your position using HMRC's HMRC: MTD for Income Tax step by step before relying on a general summary.
Section 02
The reporting sequence and deadlines
For each self-employment and property business, compatible software creates quarterly totals from your digital records. Quarterly updates are summaries, not tax returns, and you do not need to make every tax adjustment before sending them. HMRC says the standard 2026/27 update deadlines are 7 August, 7 November, 7 February and 7 May; the same deadlines apply to calendar update periods.
You must send the required quarterly updates before submitting the annual tax return. You then make the relevant annual adjustments and submit the tax return, with any tax due by 31 January after the end of the tax year. See HMRC's HMRC: send quarterly updates for the exact periods, deadlines and correction process.
Section 03
Penalties in the first year
For 2026/27, HMRC will not apply penalty points for late quarterly updates. You still need to send them before you can submit the annual tax return. The easement does not remove penalties for a late tax return or late payment.
From later tax years, late quarterly updates can attract points. The current quarterly threshold is four points, after which a £200 penalty applies and further missed submission deadlines can result in further £200 penalties. Check HMRC's HMRC: MTD Income Tax penalties for rules that apply to your year and circumstances.
Section 04
What to do now
- 01
Check whether you are in scope
Use your submitted tax-return information and HMRC guidance to calculate qualifying income before expenses. Check each active self-employment and property income source is correctly recorded.
- 02
Choose compatible software
Confirm with the software provider that it supports MTD for Income Tax for the income sources and reporting tasks you need. HMRC does not provide the software itself.
- 03
Create a digital record routine
Keep records of income and expenses in the software, reconcile transactions routinely and resolve missing information before the quarterly-update deadline.
- 04
Plan the first deadline
For 2026/27, set a reminder well before 7 August 2026. Send the update when ready rather than waiting for the deadline, then preserve time for the annual tax-return work after year end.
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