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Making Tax Digital for Income Tax (MTD IT)

Cheryl Evans avatar
Written by Cheryl Evans
Updated this week

Important changes coming to tax reporting

What's happening?

HMRC is introducing a new digital tax reporting system called Making Tax Digital for Income Tax (MTD IT). This will change how sole traders and landlords report their income, moving from annual Self Assessment returns to quarterly digital submissions.

Key dates & thresholds

When

Who's Affected

April 2026

Sole traders and landlords earning £50,000+ annually

April 2027

Threshold reduces to £30,000+

April 2028

Threshold reduces to £20,000+

What this means for you

Instead of:

  • Submitting one annual Self Assessment return

You'll need to:

  • Keep digital records throughout the year

  • Submit quarterly updates via approved software

  • Complete a final annual submission by 31st January

Who's affected:

  • Sole traders above the income thresholds

  • Landlords with property income above the thresholds

  • Anyone with both where combined income meets the threshold

What else you need to know

Registration required: You'll need to register with HMRC for MTD IT, even if you already use other HMRC digital services.

Software is essential: All submissions must be made through HMRC-approved software - paper returns and basic spreadsheets won't be accepted.

No going back: Once you register, you cannot return to the old annual Self Assessment system.

How we're supporting you

At TELUS Agriculture & Consumer Goods, we are currently developing both Farmplan Business Cloud and Farmplan Business Manager to be MTD IT compliant for in-year updates only for self-employed, UK Property and Foreign Property returns.

From one set of data you will have the ability to submit quarterly updates for all 3 submission types, if applicable. You can keep records for an individual across mutiple sets of data or software, depending on individual requirements, and make submissions from each.

Note - you will not be able to submit any MTD IT update for a business which has not been setup as a 'Sole Trader'.

Annual/final submissions will not be supported through our software.

Next steps

  1. Check if you're affected by reviewing your annual income

  2. Plan ahead - consider registering early to familiarise yourself with the new process

  3. Seek advice from your accountant or visit the HMRC website for detailed guidance

More information

For detailed guidance, visit the HMRC website or speak with your accountant.

Contact us for updates on our MTD IT compliance development and how our software solutions will support your business needs.

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