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Published on 13th January 2023
The Government has announced a phased mandation of Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA).
From April 2026, self-employed individuals and landlords with an income of more than £50,000 will be required to keep digital records and provide quarterly updates on their income and expenditure to HMRC through MTD-compatible software. Those with an income of between £30,000 and £50,000 will need to do this from April 2027. Most customers will be able to join voluntarily beforehand meaning they can eliminate common errors and save time managing their tax affairs.
The government has also announced a review into the needs of smaller businesses, and particularly those under the £30,000 income threshold. The review will consider how MTD for ITSA can be shaped to meet the needs of these smaller businesses and the best way for them to fulfil their Income Tax obligations. It will also inform the approach for any further roll out of MTD for ITSA after April 2027.
Mandation of MTD for ITSA will not be extended to general partnerships in 2025 as previously announced.
🔹 What does this mean?
Self-employed individuals and landlords will have more time to prepare for Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA).
🔹 The new deadline:
The mandatory use of software has been announced as being phased in from April 2026, rather than April 2024.
Please get in touch if you have any questions on how this may impact you. We know how difficult it is to keep on top of all these changes and new deadlines.