What is MTD for IT? Everything You Need to Know Before April 2026
Making Tax Digital (MTD) for Income Tax (IT) is more than just a change in how you report tax, it’s a shift in how you run your busxiness finances. If you’re self-employed or a landlord in the UK, this isn’t something on the distant horizon anymore. It’s happening, and the clock is ticking.
In this guide, we’ll walk you through exactly what MTD for IT is, who it applies to, the key dates you need to know, and what steps you should take to ensure you’re fully compliant and confident before April 2026.
What is MTD for IT?
Making Tax Digital (MTD) for Income Tax (IT) is more than just a change in how you report tax, it’s a shift in how you run your business finances. If you’re self-employed or a landlord in the UK, this isn’t something on the distant horizon anymore. It’s happening, and the clock is ticking.
In this guide, we’ll walk you through exactly what MTD for IT is, who it applies to, the key dates you need to know, and what steps you should take to ensure you’re fully compliant and confident before April 2026.
For ITSA specifically, it means self-employed individuals and landlords with turnover of £50,000 and above annually will need to:
- Maintain digital records of income and expenses
- Submit quarterly updates to HMRC
- Make a final declaration.
By April 2027, the threshold drops to those with turnover of £30,000 and above
MTD Timeline & Deadlines
Here are the key quarterly deadlines to submit data:
- 1 April — 30 June (due 7 August)
- 1 July — 30 September (due 7 November)
- 1 October — 31 December (due 7 February)
- 1 January — 31 March (due 7 May)
This is in addition to a final declaration, which will be due by 31st January following the end of the tax year.
Why MTD is More Than Just Compliance
It’s a complete shift in the mindset of how you keep your books and how you submit your data.
MTD is a transformation opportunity. Here’s why:
- Real-Time Visibility: Stay updated with your tax position throughout the year
- Fewer Errors: Digital tracking means fewer forgotten receipts and incorrect entries
- Better Planning: More frequent insights for more proactive decisions
Benefits of Getting Ahead Now
Why wait? You can start using MTD-compliant software today. Submit your 2024/25 data digitally, begin logging 2025/26 transactions, and hit the ground running in April 2026.
Some reasons to start early:
- Avoid last-minute scrambling
- Familiarise yourself with the software
- Reduce the risk of penalties
- Build confidence with digital record keeping
What Happens If You Don’t Comply?
HMRC will operate a penalty point system. If you miss a submission, you earn a point. Four points = a fine.
Common pitfalls to avoid:
- Assuming you’re exempt
- Relying on spreadsheets alone
- Delaying setup until the deadline
- Waiting for your accountant to lead the charge
Recommended MTD Software
Nuvo recommends:
- FreeAgent for landlords: Includes a bespoke property setup and can be free with a Mettle or NatWest business account.
- Xero Simple Start for sole traders: Easy bank-feed connections and receipt storage.
Set up now and use this year as a trial run before full compliance is required.
How to Get Started with MTD for IT
- Check Your Eligibility: Is your turnover £50,000 or above?
- Separate Business Finances: Open a dedicated business bank account.
- Choose Software: Xero or FreeAgent depending on your situation.
- Start Submitting Early: Try submitting your 2024/25 data via MTD.
- Talk to Your Accountant: Make a plan now, not in March 2026.
Final Thoughts: Don’t Wait for the Deadline
MTD for IT is a game-changer, but only if you treat it as such. By preparing today, you’ll reduce stress, avoid penalties, and possibly even discover tax-saving opportunities you wouldn’t have caught with manual methods.
Nuvo is here to help you every step of the way. From webinars to checklists and free digital tools, the support is there, you just need to take action.
Additional Resources
- Goverment Website: gov.uk/making-tax-digital
- FreeAgent: https://www.freeagent.com/guides/making-tax-digital/
- Xero: https://www.xero.com/uk/programme/making-tax-digital/
