If you’re self-employed (or earn money from property) and earn over £50,000 in qualifying gross income, you now have to join Making Tax Digital for Income Tax Self Assessment (MTD ITSA).
From now on, you have to keep digital records of all of your business income and expenses, and submit quarterly updates to HMRC via approved digital accounting software.
And you still have to submit a final declaration by 31st January.
HMRC won’t apply any penalty points for late updates during the first year of MTD ITSA — but from year two, the points-based penalty system applies, so it’s worth getting into good habits early.
Do you have to join MTD ITSA now?
Your eligibility date depends on how much you earn.
- From 6 April 2026 if your qualifying gross income from self-employment and property was over £50,000 in the 2024/25 tax year.
- From 6 April 2027 if your qualifying gross income was between £30,000 and £50,000.
If you earn below £30,000, there are no fixed joining dates yet.
Important: If you have both self-employed income and rental income, you need to add both together when working out whether you cross the threshold – it’s your total qualifying gross income that determines your joining date.
If you jointly own a rental property, only your share of the income counts toward your own threshold – not the full rental income.
Read more background here: MTD for Income Tax – who it affects, and when
What are the quarterly update deadlines?
Once you’re signed up, you’ll need to submit four updates per year covering each quarter of the tax year. The deadlines are:
- 7th August (covering 6 April – 5 July)
- 7th November (covering 6 July – 5 October)
- 7th February (covering 6 October – 5 January)
- 7th May (covering 6 January – 5 April)
If you fall within the first batch of people required to join MTD (earning over £50,000), the first deadline – 7th August 2026 – is approaching fast.
What information do you need before you sign up?
- A Government Gateway user ID and password
- You must be registered for Self Assessment (and have submitted a return in the last 2 years)
- Your National Insurance (NI) number
- Details about your business (name, address, what trade you are in, business start date)
- Your chosen accounting software (e.g. Xero, QuickBooks, Sage, or bridging software)
- Your accounting method – most sole traders will use the cash basis (recording income and expenses when money actually changes hands), which is the MTD default
If you’re researching for the future and have only just started your business, read this ByteStart guide: How to register as self-employed
What counts as ‘keeping digital records’?
Keeping digital records doesn’t mean you have to spend hours on bookkeeping.
In practice, it means logging all your business income and expenses in your accounting software – for example, photographing receipts with your phone, connecting a bank feed so transactions import automatically, and recording mileage digitally rather than in a paper logbook.
There are so many excellent accounting software products now, making all of these tasks far easier than they have been in the past.
90% off Xero Accounting Software for 6 months
Fully compatible with Making Tax Digital (MTD) for sole traders from April 2026.
How to sign up
- Check when you have to join MTD ITSA
Confirm your income is above the current threshold by looking at last year’s Self Assessment. - Choose MTD-compatible software
You must use HMRC-approved digital software. Cloud accounting tools like Xero (which includes a 30-day free trial) are very popular with small firms.
See our guide to accounting software for sole traders - Sign in to your Government Gateway account
Go to Sign up for Making Tax Digital for Income Tax (GOV.UK) and follow the prompts. - Enter your details
Include your business information, National Insurance number, accounting method, and chosen software. - Wait for confirmation
HMRC will confirm your enrolment via email. You can then link your software to your HMRC account and start submitting updates.
Can my accountant register on my behalf?
Yes, absolutely. If you already have an accountant, the MTD rollout will be a priority for them. If you have any concerns about MTD, you can find many firms that will take care of all your accounting needs for a fixed monthly fee.
Here are some useful guides to read next:
Why you should get prepared now, or even join MTD early
You can sign up voluntarily even if your qualifying gross income is below the current threshold. It’s a good way to get familiar with the new system (and accounting software) without any last-minute stress.
- Are you exempt from Making Tax Digital for Income Tax?
- Read our full guide to Making Tax Digital for the self-employed
