What Is Making Tax Digital and Who Does It Affect?

Making Tax Digital (MTD) is HMRC’s programme to move tax reporting online, replacing manual records and paper returns with digital records and compatible software. Here is what it means in plain English.

MTD for VAT

MTD for VAT is already in place. VAT-registered businesses must keep digital records and submit VAT returns using MTD-compatible software. If you are VAT-registered, this already applies to you.

MTD for Income Tax

MTD for Income Tax Self Assessment is being introduced for sole traders and landlords, based on qualifying income from self-employment and property:

• From 6 April 2026: qualifying income over £50,000.
• From April 2027: qualifying income over £30,000.
• From April 2028: qualifying income over £20,000.

Those within scope will need to keep digital records and send HMRC quarterly updates, followed by a final declaration after the year end.

MTD for Corporation Tax

HMRC has said it intends to extend MTD to Corporation Tax in future, but no mandatory date has been set at the time of writing.

What you need to do

If MTD applies to you, the key steps are to use compatible software and keep digital records. The sooner you move across, the smoother it is. Our Making Tax Digital service confirms what applies to you, sets up the software, and handles the submissions.

Figures and rules are correct to the best of our knowledge as of October 2026 and relate to the 2026/27 tax year unless stated. Tax rules change and depend on your circumstances, always check current guidance on GOV.UK or speak to us before acting.