Overview
- MTD for Income Tax became a legal requirement on 6 April 2026 for sole traders and landlords with turnover above £50,000.
- HMRC has begun directly emailing affected taxpayers and is running webinars and short videos to explain how to sign up and use MTD‑compatible software.
- Under the new system annual Self Assessment is replaced by quarterly updates plus an end‑of‑year submission and all returns must be sent via approved digital software.
- A FreeAgent survey found 22% of those affected expect a negative impact while 19% of early adopters say the system has had a positive effect, with many remaining uncertain about the change.
- The policy will expand in stages with higher numbers required to join from April 2027 and April 2028, and small businesses are being urged to choose compliant software or work with an agent to avoid missed deadlines and extra admin.