Last Updated on 05/11/2025 by Adrian Lamb
Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA)
Summary
Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) represents a significant modernization of the UK’s tax system for sole traders and landlords. The core of the policy requires these individuals to maintain digital business records and use MTD-compatible software to provide quarterly updates on income and expenditure to HM Revenue & Customs (HMRC).
General Description
Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) is a government measure that mandates the use of digital tools for tax administration. Affected businesses and landlords are required to:
- Keep their business records digitally.
- Use MTD-compatible software to provide digital quarterly updates to HMRC.
- Submit their final Income Tax Self-Assessment (ITSA) return information through the same software.
Implementation Timeline
The introduction of MTD for ITSA is structured in two main phases:
| Operative Date | Qualifying Income Threshold | Affected Activities |
| 6 April 2026 | Over £50,000 | Trading and property income chargeable to Income Tax and Class 4 National Insurance contributions. |
| 6 April 2027 | Over £30,000 | Trading and property income chargeable to Income Tax and Class 4 National Insurance contributions. |
