Important Making Tax Digital for Income Tax Update

What You Need to Know

If you received a letter from HM Revenue & Customs (HMRC) recently that mentions Making Tax Digital (MTD) for Income Tax, don’t worry. It’s an important update, but it’s something you can prepare for. HMRC is steadily rolling out communications to taxpayers who will need to use the new digital tax reporting system starting 6 April 2026.

At Whitings LLP, we want to make sure you understand what these letters mean, why you may have received one, and what action you may need to take.

Why Am I Getting a Letter?

HMRC is sending out MTD awareness letters in February and March 2026 to people who submitted their 2024–2025 Self-Assessment tax return and whose combined annual gross self-employment and rental income suggests they will fall into the first group required to use ‘MTD for Income Tax’ next April.

These letters are not asking for anything urgent today, but they do tell you:

• You’ll need to use MTD for Income Tax from 6 April 2026 if your combined annual gross self-employment and property income during 2024–25 was above £50,000.
• What you will need to do to get ready, including choosing and signing up for compatible digital tax software.
• That you should speak to your tax agent (like us) to discuss next steps.

The letters also include a QR code that links directly to HMRC’s step-by-step guidance on GOV.UK.

Important: HMRC does not automatically copy these letters to your agent, so if you get one, please let us know as it will help us advise you on your next steps.

What’s Changing in 2026?

From 6 April 2026, if your qualifying combined annual gross self-employment and rental income for 2024–25 was over £50,000, you will no longer just file a single Self-Assessment tax return each year in the way you’re used to. Instead, you will need to:

• Keep digital records of your income and expenses in software that is approved by HMRC.
• Submit quarterly updates to HMRC via that software during the year, summarising your business and/or property income and costs.
• Still complete a final declaration (similar to a tax return) by the following 31 January, but one that reflects the quarterly information already submitted.

This is part of HMRC’s digital modernisation, spreading tax reporting across the year rather than waiting until the very end.

Do You Need to Act Now?

Yes — but there’s time.

Because the first quarterly update won’t be due until early August 2026, you have a period to:

1. Check whether your 2024–25 income means you fall into the first MTD group. (If that total was over £50,000 from self-employment and/or rental income, the answer will be yes.)
2. Choose and sign up for HMRC-compatible software. There are both free and paid options depending on your needs.
3. Start keeping digital records, updating them regularly will make quarterly submissions much easier.

Even if you’ve not had a letter yet, the same rules will apply if your income meets the threshold, so it’s better to prepare now rather than wait.

How Whitings LLP Can Help

We’re here to guide you through every step of this change.

That includes:

• Reviewing your income figures and confirming whether MTD applies to you
• Helping you choose the right software
• Helping set up and test your digital record-keeping
• Ensuring your first quarterly submissions are done correctly

Get In Touch

If you’ve received an MTD awareness letter or want clarity on how this affects you, please get in touch with your local Whitings LLP office or your usual Whitings contact.

With the right preparation, this change can be straightforward and you’ll be set up with a digital process that makes tax admin easier throughout the year.

Disclaimer - All information in this post was correct at time of writing.