HMRC is set to inform taxpayers affected by Making Tax Digital (MTD) for Income Tax, with letters starting in April. Initially, these will go to landlords, sole traders, and self-employed individuals earning over £50,000.
From 6 April 2026, those earning above this threshold must report income quarterly. While this is the first time HMRC has directly notified individuals, accountants are also urged to prepare their clients.
Letters will be sent from April 2025 to taxpayers whose 2023/24 self assessment returns indicate income at or above £50,000. Early sign-up is available with two options:
- Join for the 2025/26 tax year: This allows firms and clients to familiarise themselves with the system before the deadline. Early adopters will receive support from a dedicated HMRC team.
- Join for the 2026/27 tax year: Mandatory participation begins.
Some taxpayers, however, including those on HMRC payment plans, receiving income from trusts, or using profit averaging, are ineligible for early enrolment. Exemptions exist for age, disability, location, or religious beliefs.
Those already exempt from MTD for VAT do not need to reapply. As these changes approach, accountants must ensure they understand their clients’ impacts.
Talk to us about your MTD concerns.
