HMRC MTD for Income Tax Changes in 2026

Team Nomi

Mar 27, 2026
5 minutes read

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Making Tax Digital is changing how people report their income. The HMRC MTD for Income Tax changes will affect self-employed individuals and landlords from April 2026. If you currently file a Self Assessment tax return, it is important to understand what is changing and how to prepare.

HMRC’s MTD for Income Tax changes will replace the annual Self Assessment with quarterly digital updates and a final declaration. You will also need to keep digital records and submit your income details using HMRC-approved software.

Get ready to embrace technology, as these new rules help you stay on top of your taxes and reduce surprises at year-end.

What is Making Tax Digital for Income Tax?

Making Tax Digital (MTD) for Income Tax is an HMRC initiative to digitise and improve the accuracy of tax reporting.

• • Keep digital records of your income and expenses
  • Send updates to HMRC every quarter
  • Submit a final declaration at the end of the tax year

This replaces the current once-a-year Self Assessment process for many taxpayers.

MTD Changes to Self Assessment

The HMRC self-assessment changes 2026 will bring major updates to how tax is reported.

1. Quarterly updates

Instead of filing once a year, you will send updates every 3 months. These updates will include your income and expenses.

2. Digital record keeping

You must keep your records in digital format using compatible software, such as Nomi, which helps you manage records and stay compliant with MTD requirements easily.

3. Final declaration

At the end of the year, you will confirm your income and submit a final declaration to HMRC.

These HMRC MTD for Income Tax changes are designed to reduce errors and improve accuracy.

Who will be affected?

From April 2026, the HMRC MTD Income Tax changes 2026 will apply to:

• • Self-employed individuals
  • Landlords

This applies if your total income from these sources is over £50,000 per year.

If your income is between £30,000 and £50,000, you are expected to join from April 2027 based on current HMRC plans.

How to prepare for MTD

Preparing early is important. Here are simple steps you can take:

1. Check if you are affected

Review your income to see if you meet the £50,000 threshold.

2. Move to digital records

Start keeping your income and expenses digitally.

3. Use MTD-compatible software

Choose software that works with HMRC systems.

4. Get professional advice

Speak to an accountant if you are unsure about your obligations.

How will quarterly reporting work?

Quarterly reporting is an important part of the HMRC MTD for income tax changes.

You will need to submit updates every quarter:

• • April to June
  • July to September
  • October to December
  • January to March

Each update will show a summary of your income and expenses. You do not need to calculate your final tax during these updates.

What records do you need to keep?

Under the new rules, you must keep digital records of:

• • Business income
  • Expenses
  • Property income (if applicable)

You can no longer rely on paper records alone. Using HMRC-approved software will help you stay compliant with the HMRC MTD income tax changes 2026.

How MTD will affect your tax return

The HMRC self-assessment changes 2026 will replace the traditional tax return for many taxpayers.

Instead of one submission:

• • You will send quarterly updates
  • Then complete a final declaration

This means more regular reporting but less pressure at the end of the year.

Benefits of the new system

Although the changes may feel challenging at first, there are some clear benefits:

• • Better visibility of your tax position
  • Fewer errors in reporting
  • No last-minute rush to meet deadlines
  • More organised financial records

What happens if you do not comply?

If you do not follow the new rules, HMRC may charge penalties.

You could face penalties if you:

• • Misses quarterly deadlines
  • Fail to keep digital records
  • Do not use compatible software

Staying prepared for the HMRC MTD for income tax changes will help you avoid unnecessary fines.

Role of accounting software

Using the right software is essential under the new rules.

MTD-compatible software can help you:

• • Track income and expenses
  • Submit quarterly updates
  • Stay compliant with HMRC

It also reduces manual work and helps avoid mistakes when dealing with the HMRC MTD Income Tax changes 2026.

Important dates to remember

Here are important dates based on current HMRC guidance:

• • April 2026 – MTD starts for income over £50,000
  • April 2027 – Expected start for income over £30,000

Make sure you are ready before these deadlines to avoid disruption.

Disclaimer: This article is for informational purposes only and does not constitute financial or legal advice. For complex situations or uncertainties related to MTD‑ITSA, always consult a qualified accountant or refer to HMRC’s official resources.

Conclusion

The HMRC MTD for Income Tax changes in 2026 will change how self-employed individuals and landlords report their income. Moving from yearly returns to quarterly updates may feel new, but it helps you stay organised and aware of your tax position throughout the year.

By starting early, keeping digital records, and using the right software, you can adjust smoothly and avoid penalties. Preparing now will make it easier to follow the new rules and manage your taxes with confidence.