The first Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) figures have revealed that more than 436,000 sole traders and landlords have successfully sent their first update.
Making Tax Digital for Income Tax Self-Assessment
MTD for ITSA came into effect on the 6th of April 2026 and becomes mandatory once an individual reaches the earnings threshold.
For example, sole traders and landlords are affected from the:
- 6th April 2026, if you have an annual business or property income of more than £50,000
- April 2027, if you have an annual business or property income of more than £30,000
- April 2028, if you have an annual business or property income of more than £20,000
Responsibilities include keeping records of your income and expenses using HMRC-compatible software and then submitting quarterly updates, the first of which was due on the 7th of August 2026.
Visit our Making Tax Digital: Income Tax Quarterly Updates Explained for more information on how this works.
Need help deciding between Limited or Umbrella? We are happy to help- give Sophie a call on 01442 795 100 or email sophie.lewis@dolanaccountancy.com
Making Tax Digital Soft Landing for 2016/27
There are still some individuals who have not yet sent their first quarterly update; however, they have time to do so without incurring penalties despite missing the deadline date.
This is due to HMRC treating the first year as a ‘soft landing’ period. Our What Do I Need to Know About Making Tax Digital page covers everything you need to know about penalties and how they work once they come into force.
From September 2026, HMRC will start signing up those who should be using MTD for the 2026/27 tax year, but who have not done so yet.
To find out more about contracting, please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.
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