Making tax digital for income tax

Making Tax Digital (MTD) for income tax represents a move towards a fully digital approach to income tax reporting in the UK, requiring many self-employed individuals and landlords to keep digital records and move away from one annual return and towards regular quarterly updates.

Who is affected and who is not affected?

From 6 April 2026, self-employed individuals and landlords with qualifying income over £50,000 must comply with MTD for income tax. Those with qualifying income over £30,000 are due to join from 6 April 2027 and those with qualifying income over £20,000 are due to join from 6 April 2028.

Members of partnerships, trustees of trusts and personal representatives administering estates are not currently within the scope of mandatory MTD for income tax in those capacities, but may need to consider their individual affairs separately.

A person can claim exemption if it is not reasonably practicable for them to use digital tools and HMRC considers these cases individually. Certain other exclusions also apply.

What does being mandated for MTD mean?

Being mandated for Making Tax Digital (MTD) means that HM Revenue & Customs (HMRC) require you to:

• Keep digital records of your business income and expenses in MTD-compatible software .
• Submit business tax information to HMRC digitally through the software each quarter rather than manually entering figures into HMRC’s online services.
• Submit an end of year declaration to HMRC with your non-business information and any tax adjustments.

Whilst MTD compliance is about reporting income quarterly it does not mean that you need to pay income tax quarterly. The usual income tax payment days remain the same under MTD.

How can we help?

We work with landlords, business owners and families across the UK on managing their tax affairs and MTD.

We can assess your current record-keeping systems and identify what changes may be required to be MTD compliant. We will work with you to transition from spreadsheets and manual data entry to a compliant cloud-based process using Xero accounting software.

Our team can prepare, review and submit your quarterly updates and end of period statement, reviewing your affairs and assist you in claiming any deductions or allowances to which you may be entitled and ensuring all payments are made on time.

If you are unsure whether MTD applies to you we can review your income sources to confirm whether you fall within HMRC’s requirements and recommend steps to take.

Beyond MTD compliance, we provide proactive tax planning and strategic advice to help you reduce administrative burdens, understand your future tax position and make informed financial decisions.

If you would like to understand how Making Tax Digital may affect you, or if you need support implementing compliant digital processes, our team is here to help.

Managing trusts and navigating an increasingly complex tax system can be time consuming and daunting.

Generations of families and businesses have relied on our expert team of specialists to relieve them of the burden of trust management and tax compliance.

Our Trust & Tax Management practice can help you to protect your assets and pass on your wealth to the next generation tax efficiently, and in the way that best suits your circumstances.

The tax compliance and trust management team looks after the accounting, taxation and administration aspects of running different kinds of trusts, charities and other structures, including family investment companies.

We provide a personal tax advisory and compliance service across Kent, the South East and nationally, assisting trustees, beneficiaries and other individuals with their income, property and capital gains tax needs.

Our team also works to manage inheritance tax reporting for periodic charges, exits and other events, and to support executors in the preparation of estate accounts and tax returns for estates.

Key clients include:

• People creating trusts (settlors), charities and family investment companies
• Trustees and executors
• Family offices
• Beneficiaries and other individuals with private wealth
• Business owners
• Property owners and landlords (including non-resident landlords)
• Non-UK resident and non-UK domiciled individuals with reporting requirements in the UK.

As part of a full service law firm, we can call on expertise from our Wills, Estate & Tax Planning, Probate, Will, Trust & Estate Disputes and Family teams as needed.