MTD for Income Tax: the 2026 guide for sole traders and landlords

Published June 2026 · 8 min read

Making Tax Digital for Income Tax (MTD ITSA) is the biggest change to Self Assessment in a generation. Instead of one tax return every January, affected sole traders and landlords keep digital records and send HMRC an update every quarter. It became mandatory in April 2026 for the first group — and the thresholds keep dropping.

Who has to do MTD, and when

• From April 2026: self-employment and/or property income over £50,000 a year.
• From April 2027: the threshold drops to £30,000.
• From April 2028: it drops again to £20,000.

The test is your combined gross income from self-employment and property — turnover, not profit. A subbie invoicing £42,000 who also collects £12,000 rent is over the £50,000 line even though neither activity is on its own. Landlords should also read our landlord Self Assessment basics.

What actually changes

1. Digital records become compulsory

Income and expenses must be kept in software — a shoebox of receipts or a paper diary no longer satisfies the rules. The records need to be captured digitally and sent to HMRC digitally.

2. Quarterly updates

Four times a year you send HMRC a summary of income and expenses for the quarter. The quarters follow the tax year (which runs 6 April to 5 April), and each update is due roughly a month after the quarter ends. Miss them repeatedly and HMRC’s points-based penalty system starts to bite.

3. Final declaration

After the fourth quarter you finalise the year — allowances and adjustments are applied and the final position is confirmed. The 31 January deadline for paying your tax doesn’t move, and payments on account work as before.

What stays the same

• How much tax you pay — MTD changes reporting, not rates.
• The tax year itself: 6 April to 5 April.
• Payment dates: 31 January (and 31 July for payments on account).
• Allowable expenses — the same costs you can claim now still apply.

What quarterly updates look like on SubReady

SubReady was built WhatsApp-first so the digital record happens the moment the money moves: you snap a receipt, send a bank statement PDF, or type “fuel £40 Shell” and it’s categorised into your books. By the time a quarter closes, the update is already assembled:

• The Making Tax Digital page (web and mobile) shows all four quarters with live status — in progress, ready to file, filed, or overdue — with each quarter’s income and expense figures behind a drill-down.
• You review the figures and confirm by typing SUBMIT — nothing goes to HMRC without that explicit, typed confirmation.
• Every filed update is archived under Submitted returns with PDF/CSV downloads, so you can always prove what was sent and when.
• You can even ask on WhatsApp — “what quarters are due?” — and get your live MTD status back in seconds.

Step-by-step instructions are in our help centre: MTD quarters & filing.

How to get ready in one afternoon

• Work out your combined self-employment + property turnover — know which wave you’re in.
• Start keeping digital records now: every receipt photographed, every statement uploaded.
• Pick software that files quarterly updates for you and keeps the archive.
• Tell your accountant which system you use — SubReady gives accountants read-only access with your approval, so they can check your quarters without email chains.

Common MTD questions

Do quarterly updates mean paying tax four times a year?

No. The updates are reports, not bills. Tax is still paid on the usual dates — 31 January, plus 31 July if payments on account apply. What changes is that HMRC (and you) can see the year building in real time.

What if a quarter’s figures aren’t perfect?

Quarterly updates are cumulative summaries, and corrections flow through later updates and the final declaration. That’s not a licence for sloppiness — but a missed receipt in Q2 isn’t a crisis if it’s in the books by Q3.

I’m under £50k but growing — when do I check?

Each April, against your combined self-employment and property turnover. Cross a threshold and you’ll typically be brought in from the following April — another reason a live turnover figure beats a year-end surprise.

Can my accountant handle MTD for me?

They can review and support — but the quarterly rhythm only works if the records exist as you go. Digital capture is the part only you can do; SubReady makes it a ten-second habit, and your accountant gets read-only access to check the rest.

MTD rewards people whose books are always up to date — and punishes the January shoebox. Moving your record keeping to something you already use every day is the simplest fix there is. That’s the whole idea behind SubReady on WhatsApp — from £8.99/month with a 14-day free trial.