MTD for Income Tax
How can you get ready?
Despite numerous delays and pushbacks, MTD for ITSA is coming and the Pilot is now live with HMRC. The mandation of MTD for Income tax will be phased, with the current dates set as:
From April 2026, self employed individuals and landlords with income over £50,000
From April 2027, it will be mandated to those with an income between £30,000 and up to £50,000
The £50,000 is Gross income i.e turnover and not profit. If an individual has £24,000 property turnover and £33,000 self-employed turnover this would mean the £50,000 threshold is exceeded and therefore be mandated for MTD for ITSA from April 2026.
As it currently stands, general partnerships and all other partnerships are expected to be required at a future date but that has not yet been set.
What does it mean?
All businesses that meet the MTD for ITSA will have to provide quarterly updates of their income and expenses to HMRC. These will fall due as follows:
Period Filing Deadline
Quarter 1 6 April to 5 July 7 August
Quarter 2 6 April to 5 October 7 November
Quarter 3 6 April to 5 January 7 February
Quarter 4 6 January to 5 April 7 May
This will mean needing to keep your record up to date much more regularly, and it will need to be recorded and submitted digitally through a HMRC approved provider.
What if I have a trade and a property business?
Separate quarterly updates are required for each trade or property business carried on by an individual meaning you will have to keep each of your sources of income in separate electronic bookkeeping systems.
Final Declaration
This will bring together all business and personal information to determine the final tax liability for an individual, in the same way as the current self assessment. The deadline for the submission of this will still be 31 January following the end of the relevant tax year.
Updated notices and legislation are expected shortly.
Contact us if you have any questions.
