Making Tax Digital
Making Tax Digital for ITSA: Support for Landlords and Sole Traders
MTD for Income Tax will change how many landlords and sole traders keep records and report income to HMRC. We can help you assess whether you are affected, choose the right software approach, and prepare for quarterly reporting.
Understanding Your Position
Do You Need to Prepare?
You may be affected by MTD for ITSA if you receive:
- Self-employment income as a sole trader or freelancer
- Property rental income from UK residential or commercial lettings
- A combination of both, where your total qualifying income exceeds the phased thresholds
The requirements are being introduced gradually, starting with those earning over £50,000 in April 2026, then extending to lower thresholds in subsequent years.
What is Changing
A New Way to Report Your Income
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is a new HMRC requirement that changes how eligible individuals report their income.
Instead of submitting a single annual Self Assessment tax return, those affected will need to:
- Keep digital records of income and expenses using compatible software
- Submit quarterly updates to HMRC summarising their financial position
- Complete an end-of-year finalisation process after the tax year ends
This is a significant change, but with the right preparation and support, the transition can be straightforward.
Software Options
Finding the Right Approach
Not everyone needs to adopt full bookkeeping software. Depending on your circumstances, there are different ways to meet the MTD requirements:
Spreadsheet with Bridging Software
For landlords or sole traders with straightforward affairs, a structured spreadsheet combined with compatible bridging software can be a practical and cost-effective solution.
Dedicated Bookkeeping Software
For those with more complex affairs, higher volumes of transactions, or a preference for automation, dedicated MTD-compatible bookkeeping software may be the better choice.
We can help you assess which approach suits your situation and guide you through the setup process.
Timeline
When Does MTD for ITSA Start?
The new requirements are being introduced in phases based on qualifying income
6 April 2026
Over £50,000
Individuals with qualifying income above £50,000 must comply
6 April 2027
Over £30,000
Threshold extends to those with income above £30,000
6 April 2028
Over £20,000
Threshold extends to those with income above £20,000
Once you are within scope, you will need to submit updates to HMRC every quarter.
Who This Applies To
Are You Affected?
MTD for ITSA applies to individuals with self-employment or property income above the thresholds
Sole Traders
Self-employed individuals running their own business with qualifying income above the threshold.
Landlords
Property owners receiving rental income from UK property above the qualifying threshold.
Combined Income
Individuals with self-employment and property income that together exceed the threshold.
Unsure if you are affected?
Some individuals may be exempt or have special circumstances. We can discuss your situation on a call and help you understand exactly what applies to you.
How We Help
We Make MTD Straightforward
Everything starts with a conversation. On an initial call, we will explain the new requirements, assess whether you are affected, and discuss the best approach for your situation. From there, we offer a streamlined service covering everything you need to get compliant.
On a call, we can help you understand:
- Whether you are affected and when you need to comply
- Which software approach is suitable for your situation
- What records you need to keep and how to keep them
- What quarterly submissions are required
- How to get aligned with HMRC's new rules in good time
Our Service
What Our MTD Service Includes
A streamlined engagement covering everything you need
Discovery Call
We start with a conversation to understand your situation and answer your questions.
Review of Your Circumstances
We assess whether you are affected, when you need to comply, and what applies to you.
Advice on Readiness
Clear guidance on what records you need, which software suits you, and how to prepare.
Getting You Set Up
Help implementing a compliant process aligned with HMRC requirements.
Ongoing Support
Continued support for quarterly submissions and the annual finalisation process.
FAQ
Frequently Asked Questions
Common questions about Making Tax Digital for Income Tax
Why Act Now
The Benefits of Early Preparation
While the first deadline is still some way off, preparing early gives you time to understand the requirements, choose the right approach, and build good habits before compliance becomes mandatory. Acting now means less disruption later.
Book an MTD Readiness CallWhy Prepare Now
- Avoid last-minute disruption when the deadline arrives
- Give yourself time to choose the right software and approach
- Build good habits with your record keeping before it becomes mandatory
- Understand your obligations clearly, with time to ask questions
- Ensure a smoother transition with less stress
Let's Get You Ready
Book a call to discuss MTD for ITSA. We will explain everything and help you understand exactly what you need to do.