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Making Tax Digital
NEED HELP GETTING MTD-READY?
Making Tax Digital
for Income Tax
from
April 2026
The biggest shake-up to personal tax reporting in a generation is almost
here. Lipson & Co. are ready to guide you every step of the way.
Talk to Our Team Today
What is Making Tax Digital for Income Tax?
Making Tax Digital (MTD) for Income Tax Self Assessment is a fundamental change to the way sole traders and landlords report their income to HMRC. Instead of a single annual tax return, you’ll be required to maintain digital records and submit quarterly updates using HMRC-approved sołware.
This initiative is designed to modernise the UK tax system, reduce errors, and give both taxpayers and HMRC a more accurate, real-time view of tax obligations throughout the year.
The good news? With the right support, the transition can be smooth and straightforward. That’s where Lipson & Co. comes in.
COMPLIANCE REQUIREMENTS
Who Needs to Follow MTD?
Registered for Self Assessment
If you currently complete a Self Assessment tax return, MTD for Income Tax will likely apply to you once you meet the income threshold.
Self-Employed Individuals
Sole traders and freelancers earning above the threshold from their business activities will need to comply with the new digital requirements.
Landlords & Property Income
Those earning rental income from UK property above the threshold will also be required to keep digital records and file quarterly updates.
Above the Income Threshold
MTD applies once your qualifying income exceeds HMRC's phased thresholds — being phased in from £50,000 down to £30,000 over two years.
INCOME THRESHOLDS
| Tax Year | Income Threshold | Who is Affected |
|---|---|---|
|
From April 2026 |
£50,000+ | Sole traders & landlords earning over £50,000 |
|
From April 2027 |
£30,000+ | Threshold reduced — more taxpayers brought in |
|
Future Phase |
£20,000+ | Further expansion planned (date to be confirmed by HMRC) |
OUR MTD SERVICE
How Lipson & Co. Can Help You
We offer a complete, end-to-end MTD service — from initial setup right through to your year-end digital return. You’ll never have to navigate this alone.
01
Software Setup
We'll help you select and configure the right HMRC-approved MTD sołware for your needs, whether you're a landlord, sole trader, or contractor.
02
Digital Record Keeping
We'll guide you in maintaining accurate, compliant digital records of your income and expenses — reducing errors and saving you time.
03
Quarterly Updates
We'll prepare and submit your four quarterly updates to HMRC on your behalf, ensuring deadlines are met and your figures are accurate.
04
Year-End Return
At the end of each tax year, we'll complete your final digital declaration to HMRC — tying together your quarterly submissions with any additional adjustments.
THE CASE FOR ACTING EARLY
Why You Should Prepare Now
Leaving MTD preparations until the last minute is a risk you don’t need to take. Getting ahead of the changes means you can:
✓ Transition smoothly — avoid the stress and disruption of switching at the last minute as the April 2026 deadline approaches.
✓ Reduce errors — regular digital record-keeping throughout the year means far fewer mistakes and HMRC issues.
✓ Stay on top of your tax position — quarterly updates give you a clearer, real-time picture of what you owe.
✓ Avoid penalties — HMRC will apply late filing penalties under the new points-based system.
✓ Better financial visibility — keeping digital records helps you understand income and expenditure throughout the year.
✓ Peace of mind — knowing your tax affairs are in order allows you to focus on running your business.
Let Lipson & Co. Handle
Everything for You
Whether you’re a landlord, sole trader, contractor, or small business owner, our team offers personalised MTD support so you can meet every requirement — without the stress.
When do I need to start using MTD Income Tax?
Making Tax Digital timeline to report your sole trader and property income
6th April 2026
Start using MTD Income Tax if your total property and sole trader income was more than £50,000.
6th April 2027
Follow MTD rules if income was more than £30,000.
6th April 2028
Use MTD if income was more than £20,000.