When do I need to start using Making Tax Digital for Income Tax?
If you are a sole trader, landlord or someone who previously submitted a Self Assessment tax return, you need to start using Making Tax Digital (MTD) for Income Tax when your qualifying income exceeds a HMRC-stipulated amount.
Qualifying income is the gross total of all self-employment and property rental income in a single tax year, with HMRC using the income reported in the Self Assessment tax return of a previous year to determine when you must use Making Tax Digital for Income Tax. If you qualify, HMRC will let you know and you must then use MTD-compliant software such as Easy MTD to manage and file your Income Tax.
The table below indicates the qualifying income, the tax year the qualifying income was measured in, and the date from which Making Tax Digital for Income Tax must be used.
| Qualifying Income Over | From Tax Year | Start MTD for Income Tax |
|---|---|---|
| £50,000 | 2024-25 | 6 April 2026 |
| £30,000 | 2025-26 | 6 April 2027 |
| £20,000 | 2026-27 | 6 April 2027 |
You do not need to start using Making Tax Digital for Income Tax until after you have submitted your first Self Assessment tax return, but you can choose to sign up early if you know your qualifying income will exceed the figures stated. You can also apply to HMRC for exemption. Currently there is no timeline for when taxpayers with a qualifying income of less than £20,000 need to start using Making Tax Digital for Income Tax - but that may well change!
For further information about when you need to start using Making Tax Digital for Income Tax, refer to the following HMRC web page:
https://www.gov.uk/guidance/check-if-youre-eligible-for-making-tax-digital-for-income-tax
For further information about qualifying income, refer to the following HMRC web page:
https://www.gov.uk/guidance/work-out-your-qualifying-income-for-making-tax-digital-for-income-tax
