19 Jan 2026
Making Tax Digital for Income Tax (MTD IT) is part of the UK Government's plan to transition the UK tax system to a modern, digital tax service eradicating the need for manual paper intensive processes. It means that businesses and individuals with qualifying income will be required to maintain digital records and update HMRC each quarter using compatible software.
Who will be impacted?
Initially, MTD IT will be rolled out to sole trade businesses and landlords with qualifying income in a phased approach starting from 2026.
- 6th April 2026 - Sole trade businesses and landlords with qualifying income over £50,000
- 6th April 2027 - Sole trade businesses and landlords with qualifying income over £30,000
- 6th April 2028 - Sole trade businesses and landlords with qualifying income over £20,000
Partnerships will also need to use Making Tax Digital for Income Tax in the future. HMRC will set out the timeline for this at a later date. You can find out more here: https://www.gov.uk/guidance/find-out-if-and-when-you-need-to-use-making-tax-digital-for-income-tax
If you are impacted
If you are likely to be impacted, here are the key dates you need to be aware of to avoid penalties.
| 06 Apr 2026 |
You must start keeping records using MTD for Income Tax-compatible software |
| 07 Aug 2026 |
Deadline to send your first quarterly update for April through June 2026 |
| 07 Nov 2026 |
Deadline to send your second quarterly update for July through September 2026 |
| 31 Jan 2027 |
Deadline to submit a Self Assessment tax return the usual way for 2025 to 2026 |
| 07 Feb 2027 |
Deadline to send your third quarterly update for October through December 2026 |
| 07 May 2027 |
Deadline to send your fourth quarterly update for January through March 2027 |
| 07 Aug 2027 |
Deadline to send your first quarterly update for April through June 2027 |
| 07 Nov 2027 |
Deadline to send your second quarterly update for July through September 2027 |
| 31 Jan 2028 |
Deadline to submit tax return from MTD for Income Tax software for 2026 to 2027 |
| 07 Feb 2028 |
Deadline to send your third quarterly update for October through December 2027 |
| 07 May 2028 |
Deadline to send your fourth quarterly update for January through March 2028 |
More information on Making Tax Digital can be found here: Making Tax Digital for Income Tax
How Hodge Bakshi can help
Hodge Bakshi have a dedicated team in place for Making Tax Digital for Income Tax. We can provide advice on the best software to use to meet your needs and provide expert support throughout the process, helping to ensure that you remain compliant.
To find out if you will be impacted and ask about the support we offer, contact us today
Author
Melanie O'Connor | ATT | CTA
Director
How can we help?
Based in Cardiff, Hodge Bakshi is a leading firm of Chartered Accountants and Chartered Tax Advisers with over 40 years' experience serving businesses and individuals across South Wales and the UK.
Navigating the complexities of switching from the current self-assessment process to Making Tax Digital for Income Tax will be challenging. As Chartered Tax Advisers, our experienced tax specialists are on hand to provide tailored advice and support you through the switch to digital, ensuring you are compliant with the new digitised tax system.