HMRC has confirmed that it will begin automatically enrolling some sole traders and landlords into Making Tax Digital (MTD) for Income Tax from September 2026.
The move affects taxpayers who should already be complying with the new regime but have not yet signed up. If you’re a sole trader or landlord with qualifying income of more than £50,000, now is the time to check whether MTD applies to you and take action before HMRC steps in.
Who needs to use MTD for Income Tax?
MTD for Income Tax became mandatory from April 2026 for sole traders and landlords with qualifying income above £50,000. Those within the regime must keep digital records and submit quarterly updates to HMRC using compatible software.
The rules are set to expand from April 2027, when taxpayers with qualifying income above £30,000 will also be required to comply.
What is changing?
HMRC has announced that from September 2026 it will begin enrolling taxpayers who should already be using MTD for Income Tax but have not yet registered. The process will be introduced in stages over the coming months.
While HMRC will contact affected taxpayers directly, taking action now means you can check your information is correct, choose suitable software and prepare for the new requirements on your own terms.
Why should you review your position now?
HMRC is expected to identify taxpayers using information already held on its systems. While this will be sufficient in many cases, circumstances may have changed since a tax return was last submitted.
For example:
- You may have ceased trading
- You may no longer receive rental income
- You may qualify for an exemption from MTD
- HMRC’s records may not be fully up to date
If any of these situations apply, it’s worth reviewing your position now rather than waiting to receive correspondence from HMRC.
Missed the first deadline?
The first quarterly update deadline was 7 August 2026. HMRC has confirmed that no penalty points will be charged for late quarterly updates during the 2026/27 tax year.
However, quarterly updates are still a mandatory part of the regime and businesses should take steps to become compliant as soon as possible.
How can we help?
Making Tax Digital for Income Tax represents one of the biggest changes to personal tax reporting in recent years. If you’re unsure whether the rules apply to you, need help choosing software, or would like support with registration and ongoing compliance, our MTD experts can help.
Get in touch by emailing enquiries@pmm.co.uk to discuss your Making Tax Digital obligations and ensure you’re prepared for the changes ahead.
