Are you a sole trader or landlord? Learn how Making Tax Digital for Income Tax could affect you.

Are you a sole trader or landlord?

Learn how Making Tax Digital for Income Tax could affect you.

You might have already received a letter from HMRC regarding the next phase of ‘Making Tax Digital’ (MTD).

From 1^st April 2019, HMRC implemented that MTD became a necessary requirement for VAT registered businesses above the turnover threshold of £85,000. We now know, the next phase starts from April 2026 and will affect sole traders and landlords with a qualifying income above a specified criterion.

This next phase is a significant change to tax legislation and will have a considerable influence on the way we navigate accountancy

Do not stress, we are here to help you every step of the way!

We have got the expertise to make sure you are fully prepared. Let us help you stay ahead of the game!

What is the key change?

From April 2026, specific taxpayers will be required to submit quarterly returns through the Making Tax Digital (MTD) system for Income Tax.

Who is affected?

This change will impact sole traders and landlords (both domestic and foreign), qualifying income above a specified criterion.

When will I be affected?

• April 2026 – For those with qualifying income over £50,000
• April 2027 – For those with qualifying income over £30,000
• April 2028 – For those with qualifying income over £20,000

What do I need to do to be compliant?

• Use MTD-compatible software to report your income and expenses

• Keep digital records of all your financial transactions

• Submit quarterly updates – no tax payments required, but you must keep HMRC in the loop about your income and expenses

• Submit a final tax return and pay any tax by 31st January the following year. This includes all sources of income

What are the return deadlines?

Here are the key reporting periods and deadlines for 2026/2027:

• Quarter1: 06/04/26 - 05/07/26 → Report by 07/08/26

• Quarter 2: 06/07/26 - 05/10/26 → Report by 07/11/26

• Quarter 3: 06/10/26 - 05/01/27 → Report by 07/02/27

• Quarter 4: 06/01/27 - 05/04/27 → Report by 07/05/27

• Annual Return 06/04/26 - 05/04/27 → Report by 31/01/28 and pay tax

How can Aston Shaw help so I am ready for this change?

No need to worry or stress, Aston Shaw is here to make the transition as smooth as possible. If you have not received a letter but are required to report quarterly, we will contact you directly in the next few weeks. However, if you are expecting a significant change in your income this year compared to last year and you are close to the £50,000 threshold, please get in touch with us.

We can recommend the best software tailored for your needs and for further support, if you require it, arrange a training service to help you become confident with your new accountancy software.

We understand this is a considerable transition, so would like to ensure you are familiar with the software from this year (2025/26), allowing time before the required submissions come into force.

Whether you want us to handle your returns or if you would prefer to manage this yourself, we are here for you.

Either way, we have got the expertise to support you so you can focus on what you do best – running your business! Let’s get ready for these changes together!