Making Tax Digital for Income Tax | Insights
His Majesty’s Revenue and Customs (HMRC) has confirmed its intention to implement Making Tax Digital (MTD) for Income Tax Self-Assessment from 6 April 2026. As Personal Tax Director Joyce Fleming explains, this decision will significantly change how some taxpayers record and report income and expenses to HMRC.
What is Making Tax Digital for Income Tax?
MTD for Income Tax will require self-assessment taxpayers to keep digital records of their income and expenses, and submit quarterly updates to HMRC using compatible software such as Xero. This will be in addition to the existing annual Self-Assessment tax returns that include income and capital gains from wider sources.
Who is affected by Making Tax Digital for Income Tax?
Making Tax Digital for Income Tax will come into effect for individuals who receive income from self-employment and/or land and property (excluding partnership income), in the following phases:
- From 6 April 2026: if their gross income (i.e. before deducting expenses) from those sources combined is over £50,000
- From 6 April 2027: if their gross income from those sources combined is over £30,000
- From 6 April 2028: if their gross income from those sources combined is over £20,000.
MTD for Income Tax from 6 April 2026 will apply based on Self-Assessment tax returns for the 2024/25 tax year.
What should I do to prepare for Making Tax Digital for Income Tax?
To prepare for the transition to Making Tax Digital for Income Tax Self-Assessment, taxpayers should:
- Calculate your qualifying income
- Determine if and when you will need to start using Making Tax Digital for Income Tax Self-Assessment
- Transfer to compatible software, like Xero
- Register for Making Tax Digital for Income Tax with HMRC
For advice and support on managing the transition to Making Tax Digital for Income Tax Self-Assessment, or adopting compatible software, please contact Joyce Fleming or Martin Kerr.
Personal Tax advice from Consilium Chartered Accountants
Consilium Chartered Accountants are trusted Tax advisors to SMEs, business owners, and individual taxpayers. We offer the technical expertise needed to handle any UK Tax compliance issue and the proactive insight to help clients plan for and mitigate tax risks.
Consilium provides comprehensive Tax services from Tax compliance, Tax planning and Personal tax to practical help with VAT, Inheritance tax and Capital Gains Tax.
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Joyce Fleming is a member of ACCA and Consilium’s Director of Personal Tax. With over 25 years of experience, Joyce looks after individuals with high net worth and oversees the team handling Personal Tax compliance and advice services.
