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Folkes Worton LLP

MTD for Income Tax Goes Live


The Digital Era is Officially Here

The wait is over. As we enter the 2026/27 tax year, Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA) has officially gone live.

While the ‘digital revolution’ has been discussed for years, the final regulations were laid before Parliament on 24 March 2026, solidifying the rules for nearly a million taxpayers. If you are self-employed or a landlord, here is exactly what you need to know to stay compliant.

Does This Apply to You?

The new regime currently affects individuals with a total business or property income (gross turnover, not net profit) of more than £50,000 per annum.

If you fall into this bracket, the way you interact with HMRC has fundamentally changed. The days of the ‘once-a-year’ tax scramble are being replaced by:

  • Digital Record-Keeping: You must maintain your business records electronically using MTD-compatible software.
  • Quarterly Updates: You are now required to send a summary of your income and expenses to HMRC every three months.
  • The First Deadline: Your very first quarterly update under the new system is due by 7 August 2026.
The ‘Double Duty’ Year

It is important to note that the transition period creates a bit of a filing overlap. HMRC estimates that roughly 860,000 individuals are moving into the regime this year, and for those people, the workload will temporarily increase:

  1. The New System: You must provide quarterly updates for the 2026/27 tax year throughout the current year.
  2. The Old System: You are still required to file your “traditional” annual tax return for the 2025/26 tax year by 31 January 2027.

In short: you’ll be reporting for next year while simultaneously closing off last year.

How We Can Help

We know that ‘digital transition’ can sound like a headache, but it doesn’t have to be. We have been working closely with our clients to implement compatible software and services, streamlining their bookkeeping processes to make these quarterly updates seamless.

If we aren’t already managing your MTD transition, now is the time to act. The August deadline will be here sooner than you think. Reach out to our team today on 01384 376 964 and let’s ensure your business is digital-ready and compliant.

Folkes Worton LLP Chartered Accountants
Accounting for the Future