With less than six months to go until Making Tax Digital (MTD) for Income Tax begins, HM Revenue and Customs (HMRC) has started sending letters to taxpayers who will be affected by the upcoming changes.
If you’re self-employed, a sole trader or a landlord, it’s crucial to understand what MTD involves and what steps you need to take to stay compliant.
Why HMRC is sending MTD letters
HMRC’s letters are designed to help taxpayers prepare for the new MTD requirements coming into force from April 2026.
If you receive one, it means that — based on your 2024/25 tax return — the new rules will apply to you.
Each letter includes:
Guidance on what MTD means for you
A QR code linking to GOV.UK support
Key recommendations to help you get ready
One of the main pieces of advice is to speak with an accountant who can walk you through the changes and help you prepare effectively.
What changes come into effect from April 2026?
MTD for Income Tax will change how self-assessment taxpayers record and report their financial information.
1. It depends on your turnover
MTD applies based on your annual turnover:
Over £50,000 → Starts April 2026
Over £30,000 → Starts April 2027
Over £20,000 → Expected April 2028
If you’ve received a letter, it means your turnover is above £50,000 and you’ll enter the system in 2026.
2. Paper records will no longer be accepted
You will need to keep digital financial records, either:
Through accounting software, or
Via an online spreadsheet that links to HMRC
3. Quarterly reporting becomes mandatory
Instead of submitting one self-assessment each year, you will now:
Submit quarterly updates to HMRC, and
Finalise your tax position at the end of each tax year
This creates a more regular reporting cycle and requires consistent digital record-keeping.
How accountants can help you prepare
Even if MTD doesn’t apply to you until 2027 or later, it’s wise to start preparing early. The sooner you understand the new requirements, the easier the transition will be.
Accountants can support you by:
Explaining exactly how MTD works
You’ll know what’s changing, when it affects you and what it means for your current processes.
Recommending the right digital tools
This includes accounting software or spreadsheets that meet HMRC’s digital reporting criteria.
Helping you stay organised
They can guide you on maintaining accurate digital records and keeping on top of quarterly submissions.
Checking your figures before submission
They’ll spot errors, inconsistencies or risks in your data before anything is filed with HMRC.
Supporting wider tax planning
Alongside MTD preparation, accountants can review your overall financial position and help you:
Reduce liabilities
Identify tax-saving opportunities
Strengthen long-term financial stability
Now is the best time to get ready
Even if MTD doesn’t apply to you immediately, preparing early will make the transition far smoother. The right support ensures you stay compliant, avoid unnecessary stress and put better systems in place well before the rules become mandatory.
Get MTD ready by speaking with our expert team of accountants.