MTD Income Tax
Written by
Ray Coman
Making Tax Digital for Income Tax (“MTD ITSA”) changes how landlords and sole traders report income to HMRC.
It does not alter the underlying tax rules, but it does change the reporting timetable: quarterly updates during the year, followed by an end-of-year Final Declaration (which replaces the traditional SA100 submission step, commonly referred to as the tax return) for those within MTD.
The practical deadline that matters is the first quarterly submission date: 7 August 2026.
What is changing (what you file)
Digital records and software options
Who is affected (thresholds)
MTD for Income Tax applies by reference to your gross income (not profit) from self-employment and/or UK property, as shown on your tax return for the relevant year:
From 6 April 2026: gross income over £50,000 (based on 2024/25)
From 6 April 2027: gross income over £30,000 (based on 2025/26)
From 6 April 2028: gross income over £20,000 (based on 2026/27)
Gross income means total rental and/or trading income before expenses.
What is changing (what you file)
For those within MTD, the year becomes a five-submission cycle:
Four quarterly updates (summary income and expenditure updates during the year)
One Final Declaration after the tax year end (which replaces the traditional SA100 submission step, commonly referred to as the tax return)
If you also have employment, dividends, interest or other sources, these are included in the Final Declaration in the usual way.
Key dates and deadlines
Quarterly periods follow the tax year:
6 April – 5 July
6 July – 5 October
6 October – 5 January
6 January – 5 April
For clients entering from April 2026:
First quarter ends: 5 July 2026
First reminder email from Coman & Co: 6 July 2026 (the first day the report can be filed)
First submission deadline: 7 August 2026
Sign-up and consent
If you want Coman & Co to manage MTD ITSA for you, we can sign you up for the 2026/27 tax year.
Many clients already have a Self Assessment authorisation in place with us. Where this exists and is linked to our Agent Services Account, a separate MTD authorisation is not normally required.
We will not sign you up to MTD without your instruction. Once you confirm that you would like us to manage your quarterly submissions, we will complete the necessary registration with HMRC at the appropriate time.
Digital records and software options
Digital records do not necessarily mean full accounting software. Acceptable approaches may include:
Accounting software (for example QuickBooks or Xero)
Spreadsheet records
Spreadsheet summaries based on downloaded bank transactions
Where appropriate, we can use MTD bridging software. In practical terms, this means submitting quarterly figures from a structured spreadsheet summary of income and expenditure (often built from a spreadsheet download of your bank transactions).
We resell QuickBooks at a discount, but we can work with whatever software you choose. Direct debit is required if purchasing software through us.
Fees
If we manage your MTD quarterly reporting:
£40 + VAT per quarterly report
+ 50p + VAT per transaction where bookkeeping is required
Minimum quarterly fees:
£60 + VAT – landlord + self-employed, or self-employed + VAT
£80 + VAT – landlord + self-employed + VAT
If you take our quarterly MTD service, we apply an £80 discount to your annual tax return fee.
There is no discount for late catch-up submissions.
Next steps
If you require assistance with Making Tax Digital for Income Tax, please contact us to discuss your position and compliance options.
