Who it applies to, when, and the quiet software switch worth making early.
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Making Tax Digital for Income Tax replaces the single annual Self Assessment return with quarterly digital updates, for self-employed people and landlords above the income threshold HMRC sets. If it applies to you, the way you keep records changes before the way you file does.
Who it affects: self-employed individuals and landlords with qualifying income above the threshold, rolling out in phases by income band. Below the threshold, ordinary Self Assessment continues for now.
What actually changes: instead of one return in January, you keep digital records throughout the year and send quarterly updates through MTD-compatible software, followed by a final declaration. Spreadsheets can still work if they're linked to compatible software via bridging tools, but a shoebox of receipts in April no longer will.
Why it's worth moving early rather than at the deadline: the software switch is the part that actually takes time — migrating records, learning a new habit of logging income and expenses as you go, and fixing whatever your current bookkeeping is quietly getting wrong. Doing that under a live quarterly deadline is much harder than doing it on your own schedule now.
What to do now: get onto cloud software (Xero, QuickBooks or FreeAgent) before you're forced to, even if you're not required to file quarterly yet. Check whether your income is likely to cross the threshold in the next year or two. If you're not sure whether it applies to you yet, ask us — we'll check the current thresholds against your numbers.
Still not sure how this applies to you?
Ask us — it's free