Making Tax Digital for Income Tax

Who it applies to

In the UK, sole traders and landlords whose qualifying income (gross income from self-employment and property combined) is above a threshold, and the accountants and agents who act for them. The threshold falls in stages, so more clients come into scope each year.

What it requires, in plain terms

Making Tax Digital for Income Tax replaces part of the annual Self Assessment routine with digital records and more frequent reporting.

• Digital records. Income and expenses kept in compatible software, or in spreadsheets connected to it by bridging software.
• Quarterly updates. A summary of income and expenses sent to HMRC every quarter through that software.
• A final declaration. After the tax year, a final declaration confirming the figures, replacing the Self Assessment return for that income.

Key dates

As of November 2026:

Thresholds are based on the qualifying income reported in an earlier tax year; check HMRC's guidance for the year that applies to each client.

What it means for your systems

• For a practice, the work moves from one return a year to four updates plus a declaration for every client in scope. The volume of records that arrive as receipts, bank exports and spreadsheets grows with it.
• Client records have to be gathered, read, categorised and entered on a quarterly rhythm, with queries back to the client when something is missing.
• Each submission still needs review by a qualified person, so the useful system is the one that prepares the records and flags what needs attention, not one that submits on its own.

Official sources

• GOV.UK: Making Tax Digital for Income Tax (opens in a new tab)
• GOV.UK: check if you need to use Making Tax Digital for Income Tax (opens in a new tab)
• IRIS: what you need to know before the next tax year (opens in a new tab)

How this connects to our work

Document intelligence can read receipts, statements and invoices into categorised records in the practice's own software, with low-confidence items sent to a person and every submission approved by the accountant. See also Legal and professional.