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In Financial Year, select the tax year your income figure relates to: 2024-25, 2025-26 or 2026-27.
In Annual Turnover, enter your qualifying income: self-employment turnover plus gross rent from UK and overseas property, added together, before expenses.
Select Calculate Now.
Read the result: MTD Applicable From shows the date you must start, and Threshold Category shows which threshold your income falls under.
Select Reset to try another year or figure.
Making Tax Digital for Income Tax is being phased in by income level. HMRC decides whether you are in scope by looking at your qualifying income on the Self Assessment return for the tax year two years before.
| Phase | Qualifying income | Based on your tax return for | MTD applies from |
|---|---|---|---|
| 1 | Over £50,000 | 2024-25 | 6 April 2026 |
| 2 | Over £30,000 | 2025-26 | 6 April 2027 |
| 3 | Over £20,000 | 2026-27 | 6 April 2028 |
If your qualifying income is £20,000 or less, you do not have to use MTD for Income Tax under the current rules. You can still join voluntarily.
Qualifying income is your total gross income from self-employment and property, added together, before any expenses.
If you own a property jointly, count only your share of the rent.
A freelance designer had £35,000 of self-employment turnover and £18,000 of rent on their 2024-25 return. Neither is over £50,000 on its own, but together they make £53,000. MTD for Income Tax applies from 6 April 2026 for both income sources. In the calculator, select 2024-25 and enter £53,000.
A landlord had £28,000 of gross rent on their 2025-26 return. That is under £30,000, so MTD does not start in April 2027. If their 2026-27 rent is over £20,000, MTD will apply from 6 April 2028.
Once you are in MTD, you send HMRC a quarterly update of your income and expenses using compatible software. Each update is cumulative from the start of the tax year. You then submit a final declaration after the year ends.
| Update | Period covered | Deadline |
|---|---|---|
| Quarter 1 | 6 April to 5 July 2026 | 7 August 2026 |
| Quarter 2 | 6 April to 5 October 2026 | 7 November 2026 |
| Quarter 3 | 6 April 2026 to 5 January 2027 | 7 February 2027 |
| Quarter 4 | 6 April 2026 to 5 April 2027 | 7 May 2027 |
| Final declaration and tax payment | Tax year 2026/27 | 31 January 2028 |
The same pattern repeats every tax year. Phase 2 users make their first quarterly update by 7 August 2027.
MTD uses a points-based system for late submissions. Each late quarterly update or final declaration earns a penalty point. Once you reach the points threshold, you receive a financial penalty.
For the 2026/27 tax year, HMRC is not issuing penalty points for late quarterly updates. Late final declarations and late payments can still be penalised. Treat the first year as a chance to get your records and software working, not as a free pass.
Some people are exempt automatically. Others can apply to HMRC for an exemption.
Automatic exemptions include trustees, personal representatives of someone who has died, and people without a National Insurance number.
Digitally excluded: you can apply for an exemption if it is not reasonable for you to use software, for example because of age, disability, remote location or religious beliefs.
Leaving MTD: if your qualifying income falls below the threshold, you can usually leave once it has stayed below for three tax years in a row.
Quarterly updates mean four times the submissions for every sole trader and landlord client. AcoBloom's UK tax team handles bookkeeping, quarterly updates and final declarations for accounting firms.
You must use MTD for Income Tax from 6 April 2026 if your qualifying income was over £50,000 on your 2024-25 return. The threshold drops to £30,000 from April 2027 and £20,000 from April 2028.
It is your gross income before expenses: turnover from self-employment plus gross rent. You can be in scope even if your profit is small.
HMRC uses the return for the tax year two years before. Your 2024-25 return decides whether you start in April 2026.
No. PAYE employment income, dividends, savings interest and pensions do not count.
Not for Income Tax. Limited companies that are VAT registered already use MTD for VAT. Plans for MTD for Corporation Tax have been dropped.
Not yet. The government has said partnerships will join in due course but has not set a date.
You normally receive a penalty point, and a financial penalty once you reach the threshold. For 2026/27, HMRC is not giving points for late quarterly updates.
Yes, if you use bridging software to send the figures to HMRC from your spreadsheet.
Yes. You can sign up even if your income is below the threshold.