Who will be affected by the new Making Tax Digital requirement from April 2026

Making Tax Digital for Income Tax begins for the first wave from April 2026. If you are a self employed professional or a landlord, the rules will likely touch how you keep records, how often you send figures to HMRC, and which software you use. At Pennine Accounting in Littleborough we help businesses across Rochdale, Oldham, and West Yorkshire to prepare sensibly, with Xero powered workflows and plain speaking support.

Here is the simple version. If your total qualifying income from self employment and property is over £50,000, you will need MTD compatible software and you will send quarterly updates plus an end of year declaration. Those earning over £30,000 follow a year later in April 2027. The aim is cleaner data and fewer surprises, although it does mean a change in routine for many sole traders and landlords ¹².

What actually changes in 2026

MTD for Income Tax replaces the once a year Self Assessment routine with a rhythm of digital bookkeeping and submissions. Affected individuals must keep digital records, send quarterly updates to HMRC, and file a final declaration after year end that confirms reliefs and adjustments. This sits alongside the end of period statementOften shortened to EOPS, this is the annual confirmation of your trading or property figures, with final adjustments and reliefs applied. and moves you toward a more frequent reporting cycle ².

There is no new tax to pay, but the submission dates and format change. HMRC expects your software to maintain digital linksDigital links are data connections that move numbers between systems without manual retyping or copy and paste, preserving an audit trail. from source records through to updates, which is why choosing the right platform matters.

At a glance, who is in scope first

Quick list for the April 2026 start.

• Self employed individuals over the threshold: Total qualifying income from trade and property above £50,000 in the test year triggers MTD ITSA in April 2026 ².
• Landlords: UK property income counts toward the same threshold. Joint ownership is calculated per person, not on the whole property total ².
• Next phase: Those with income above £30,000 join in April 2027. Government has indicated a later extension for lower incomes after that, subject to confirmation ²³.
• Not included in 2026: Limited companies, LLPs, and partnerships are not mandated in this first phase. Trusts and estates are also out of scope currently ².

How many people and what must they submit

Industry estimates suggest around nine hundred thousand self employed people and landlords fall into the first wave in 2026. The majority will send four quarterly updates and a single final declaration each year once they join ¹².

Quarterly updates are high level totals for income and costs. Adjustments, capital allowances, and reliefs are handled in the final declaration and the EOPSThe end of period statement confirms your year end numbers for each business or property. It is separate from the overall final declaration.. Software will guide you through categories and keep the digital trail that HMRC wants to see.

Timeline and thresholds, simplified

A quick schedule to see where you sit.

Your record keeping options

You need software that keeps proper digital records and can send updates. Here is a quick comparison of the common approaches we see locally.

Get ready in four steps

A short plan you can start this week.

1. Confirm your qualifying incomeAdd your gross self employment turnover and your share of gross property rents for the relevant test period.. If you are close to £50,000, monitor monthly.
2. Choose software. We recommend Xero for most local businesses because it supports bank feeds, receipt capture, and clean digital links.
3. Switch to digital invoices and expense capture. Keep the digital trail from source document to submission.
4. Set quarterly reminders. Aim to reconcile monthly so that each update is smooth rather than a rush.

How Pennine Accounting can help

We set up clients on Xero, migrate data, connect bank feeds, and design a rhythm that fits your business. For sole traders we can combine quarterly update preparation with VAT returns and year end accounts so you have one joined up view. Landlords get simple categorisation, bank rules, and a pack ready for each update.

We also provide advisory reviewsA short, focused meeting to review margins, cash flow, and tax position, using up to date data from your software. each quarter, which turns compliance into something useful, not just another deadline. If you are in Rochdale, Oldham, or nearby West Yorkshire, we can meet in person or work remotely, whatever is easier.