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MTD for Income Tax
2026 Checker

Find out if Making Tax Digital applies to you from April 2026. Includes deadline tracker, readiness checklist, software guide, and penalty calculator — everything UK freelancers and tradespeople need to stay compliant.

6 Apr
2026 Start Date
Income ≥ £50k mandated first

🔍 Do You Need to Comply with MTD for Income Tax?

Answer the questions below to find out if Making Tax Digital for Income Tax Self Assessment (MTD ITSA) applies to you from April 2026.

🗓️ Quarterly Update Deadlines — 2026/27 Tax Year

If you are mandated from 6 April 2026 (gross income ≥ £50,000), you must submit 4 quarterly updates each year:

QuarterPeriod CoveredSubmission Deadline
Q16 Apr 2026 – 5 Jul 20267 August 2026
Q26 Jul 2026 – 5 Oct 20267 November 2026
Q36 Oct 2026 – 5 Jan 20277 February 2027
Q46 Jan 2027 – 5 Apr 20277 May 2027
📝 You can choose to use calendar quarters (e.g. 1 Apr – 30 Jun) instead of the standard tax-year quarters. Confirm with your software provider.

📄 Annual Submissions

SubmissionDeadline
End of Period Statement (EOPS)31 January 2028
Final Declaration (replaces the SA tax return)31 January 2028
⚠️ Payment on Account deadlines remain the same: 31 January and 31 July.

🔮 Mandation Timeline Overview

Gross Income ThresholdMTD Start DateStatus
£50,000+6 April 2026🔴 Confirmed
£30,000 – £49,9996 April 2027🟡 Confirmed
£20,000 – £29,999TBC (possibly 2028+)🟠 Under review
Below £20,000TBC / Voluntary🟢 Not yet mandated

✅ MTD Readiness Checklist

Tick off each item as you complete it. Your progress is tracked below.

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0 of 20 tasks completed

A. Registration & HMRC Setup

  • I have a Government Gateway account
  • I am registered for Self Assessment
  • I have signed up for MTD for Income Tax via HMRC's online service
  • I have authorised my accountant / agent (if applicable)

B. Software & Digital Record-Keeping

  • I have chosen MTD-compatible software
  • I am keeping digital records of all income and expenses
  • My software can submit quarterly updates to HMRC via API
  • I have stopped relying solely on paper records or manual spreadsheets

C. Financial Records

  • I record all business income (invoices, cash payments, bank transfers)
  • I record all allowable business expenses with receipts / evidence
  • I keep records of personal use adjustments (vehicle, phone, home office)
  • I separate business and personal bank transactions
  • I track CIS deductions (if applicable — common for tradesmen)

D. Tax Knowledge

  • I understand the difference between turnover and taxable profit
  • I know my tax-free Personal Allowance (currently £12,570)
  • I understand Class 2 and Class 4 National Insurance obligations
  • I know about Payment on Account requirements
  • I am aware of the VAT threshold (£90,000) — separate from MTD ITSA
  • I have reviewed the HMRC MTD guidance pages
  • I have spoken with an accountant or tax adviser about MTD

💻 MTD-Compatible Software Options

You must use HMRC-recognised software that can connect to HMRC via API. Spreadsheets alone are not sufficient.

Free / Low-Cost Options

SoftwarePriceBest For
HMRC MTD SoftwareFreeVery basic needs
FreeAgent (free via NatWest / RBS)Free*Freelancers, sole traders
WaveFreeSimple invoicing & bookkeeping

Paid Options

SoftwareApprox. CostBest For
QuickBooks Sole Trader~£12–£26/moFreelancers, tradesmen
Xero~£15–£33/moGrowing businesses
FreeAgent~£15–£30/moSole traders, contractors
Sage Accounting~£12–£26/moTraditional trades & bookkeeping
Hammock~£6/moLandlords
GoSimpleTax~£40–£60/yrSelf Assessment + MTD
Coconut~£9/moFreelancers on the go
🔍 Always verify your chosen software on HMRC's official list: gov.uk — MTD compatible software
⚠️ Bridging software (which links spreadsheets to HMRC) exists for MTD VAT, but may have limited support for MTD ITSA. Check carefully before relying on it.

⚠️ Penalties for Non-Compliance

HMRC is introducing a points-based penalty system under MTD ITSA (replacing the old penalty regime):

Late Submission Penalties

ActionConsequence
Each late quarterly update1 penalty point
Reach 4 points (quarterly filers)£200 fine
Each further late submission after reaching thresholdAdditional £200 fine
📝 Points can be reset to zero if you achieve a period of good compliance (i.e., submit everything on time for 24 months).

Late Payment Penalties

How LatePenalty
Up to 15 days lateNo penalty
16–30 days late2% of tax owed at day 15
31+ days late2% of tax owed at day 15 + 2% of tax owed at day 30
Still unpaid after 31 daysAdditional 4% per annum daily charge

Interest on Late Payments

HMRC charges late payment interest at the Bank of England base rate + 2.5%. As of 2026, this is approximately 7%.

🚨 Deliberate non-compliance (e.g., failing to keep digital records, refusing to use compatible software) could result in additional penalties up to £100 per day.

❓ Frequently Asked Questions

What exactly is MTD for Income Tax?▼
Making Tax Digital for Income Tax Self Assessment (MTD ITSA) is a government initiative requiring self-employed individuals and landlords to keep digital records and submit quarterly updates to HMRC using compatible software, instead of filing a single annual Self Assessment tax return.
Does MTD ITSA replace Self Assessment?▼
Partially. You will no longer file a traditional SA100 tax return. Instead, you'll submit 4 quarterly updates, an End of Period Statement (EOPS), and a Final Declaration. The Final Declaration is effectively your "tax return" under the new system.
I'm a CIS subcontractor / tradesman — does this affect me?▼
Yes, if you are self-employed (sole trader) and your gross income meets the threshold, MTD ITSA applies to you regardless of CIS status. You'll still receive CIS deductions from contractors, but your record-keeping and reporting must go digital. Make sure your software can handle CIS deduction tracking.
Can I still use spreadsheets?▼
Spreadsheets alone are not sufficient. You need MTD-compatible software that can submit data to HMRC via API. Some "bridging software" can link spreadsheets to HMRC, but check carefully that it is compatible with MTD for Income Tax (not just MTD for VAT).
What if my income fluctuates and sometimes falls below the threshold?▼
The threshold is based on your gross income in the tax year before the obligation starts. If your income drops below the threshold after you've been mandated, HMRC will provide guidance on whether you can exit. However, it's advisable to maintain MTD-compliant records regardless.
I'm VAT-registered and already use MTD for VAT. Do I need to do anything extra?▼
Yes. MTD for VAT and MTD for Income Tax are separate obligations. Even if you already keep digital records for VAT, you will need to ensure your software also supports quarterly income tax reporting. Some software (e.g., Xero, QuickBooks, FreeAgent) supports both.
Do I need to submit exact figures every quarter?▼
Quarterly updates are a summary of your income and expenses for that period. They don't need to be your final, exact figures — you can make adjustments in your End of Period Statement and Final Declaration. However, they should be a reasonable reflection of your business activity.
What about partnerships?▼
Partnerships are not included in the April 2026 or April 2027 mandation. HMRC has stated that partnerships will be brought into MTD ITSA at a later date, but no confirmed date has been announced yet.
Can I sign up voluntarily before the mandate?▼
Yes! You can sign up for MTD ITSA voluntarily at any time through HMRC's online service. This can be a good way to familiarise yourself with the system before it becomes compulsory.
Where can I find official HMRC guidance?▼
Visit the official HMRC pages:
Stay MTD Ready

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