The UK tax system is undergoing a significant transformation with the introduction of Making Tax Digital (MTD) for Income Tax. If you are self-employed or a landlord with an annual income above £50,000 (from April 2026) or £30,000 (from April 2027), these changes will affect you.
What is MTD for Income Tax?
MTD for Income Tax is an initiative by HMRC to digitalise the tax system, ensuring more accurate and efficient tax reporting. Under this mandate, affected taxpayers will need to:
- Keep digital records of their income and expenses.
- Use MTD-compatible software to submit quarterly updates to HMRC.
- File a Final Declaration each tax year.
How Can You Prepare for MTD?
To ensure compliance with MTD for Income Tax, consider taking the following steps:
- Choose an MTD-compatible software: Digital record-keeping is mandatory, and using approved software will make it easier to manage your tax obligations.
- Understand your reporting deadlines: Quarterly updates and a Final Declaration must be submitted on time.
- Seek professional guidance: An accountant or tax advisor can help you transition smoothly and minimise errors.
How We Can Help
At DSG, we specialise in guiding clients through tax compliance changes. Our services include:
- Assistance with selecting and implementing MTD software.
- Bookkeeping support to ensure accurate digital record-keeping.
- Personalized tax planning strategies to optimise tax efficiency.
Next Steps
Now is the time to start preparing for MTD. Our team is here to help. If you have any questions or would like to schedule a consultation, please speak to your usual contact or contact us at tax@dsg.co.uk.
We appreciate your continued trust in our services and look forward to supporting you through this change.