Making Tax Digital For Income Tax Self Assessment
MTD For ITSA
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New Tax Rules For Sole Traders and Landlords
HMRC is changing how you report your business and property income. The traditional annual Self Assessment tax return is being replaced by a mandatory digital system. Starting April 2026, many sole traders and landlords will need to submit quarterly updates using HMRC-recognised software. Swiftacc provides expert support to make this transition simple, compliant, and stress-free for your business.
What is MTD for ITSA and How Does it Affect You?
MTD for ITSA stands for Making Tax Digital for Income Tax Self Assessment. It is a new rule that requires you to keep your records digitally and send updates to HMRC more often.
Instead of one big rush in January, you will now send four small updates throughout the year. At the end of the year, you will make one final declaration to confirm your total income. This change helps you see how much tax you owe in real-time, so there are no surprises at the end of the year.
From April 2026
Who Must Comply
with MTD for Income Tax
The new rules apply to you if you are a sole trader or a landlord with a total income over £50,000 in the 2024/25 tax year. This is based on your “gross income” which is the total money you receive before you take away any expenses.
From 6 April 2026
You must follow MTD rules if your annual income is more than £50,000
From 6 April 2027
You must follow MTD rules if your annual income is more than £30,000
From 6 April 2028
You must follow MTD rules if your annual income is more than £20,000
If you own a property with someone else, only your share of the rent counts toward these limits. If you have both a business and rental income, you add them together to see if you meet the threshold.
We offer affordable and
Transparent Pricing
Our pricing for Making Tax Digital for ITSA is simple, transparent, and built around your needs. We provide fixed-fee support for digital records, quarterly reporting, and HMRC compliance, so you can move forward with confidence and no surprise fees.
Basic
- 4 x Quarterly MTD Submissions
- 1 x Final End of Year Submission
- Online Support
Bespoke
- Bookkeeping
- Payroll
- Year End Accounts
Get Ready for MTD ITSA.
Book a Free Consultation!
Get ahead of Making Tax Digital for ITSA with support from our experienced accountants. Book a free consultation with Swiftacc to discuss your reporting obligations, digital record-keeping, and the best way to prepare for the new HMRC requirements.
Benefits of Switching to
MTD with Swiftacc
01.
No More January Tax Panic
We keep your accounts updated throughout the year so there is no last-minute scramble.
02.
Total Visibility of Your Tax Bill
We provide real-time tax estimates every three months so you can plan your cash flow.
03.
Accuracy That Saves You Money
Our digital approach ensures every allowable expense is recorded correctly, keeping your tax bill as low as possible.
04.
Expert Guidance for Growth
We use your digital data to give you professional insights, helping you make better decisions about expanding your business or investments.
05.
Less Paperwork & More Control
Our simple digital systems reduce manual admin and routine paperwork, giving you more time to focus on running your business.
06.
Ongoing Support Beyond Filing
We do more than submit your updates. We provide year-round guidance on HMRC requirements, digital records, and staying compliant as the rules evolve.
How Swiftacc
- Strategic MTD Readiness & Onboarding
- HMRC-Approved Software & Integration
- Smart Digital Record Keeping
- Automated Quarterly Submissions
- Proactive Review & Penalty Prevention
- Final Declaration & Support
Frequently asked
questions
What is the qualifying income threshold for MTD for ITSA 2026?
You need to use MTD for ITSA if your gross income from self‑employment and/or UK property exceeds £50,000 in the 2024–25 tax year. The threshold will drop to £30,000 in 2027 and £20,000 in 2028.
Should I manage MTD myself or with an accountant?
You can manage MTD yourself if you are comfortable with digital bookkeeping and software. However, many choose an accountant because:
- An accountant can set up your digital records and software correctly.
- They help avoid mistakes with quarterly submissions.
- They handle tax adjustments and compliance details efficiently.
If you don’t have experience with digital accounting, an accountant can save you time and reduce risk.
What happens if I miss a quarterly update deadline?
If you miss a quarterly update, HMRC will generally begin issuing penalty points. Too many points can result in fines. HMRC’s points‑based system means you are more likely to receive a warning or point before financial penalties kick in.
Which MTD‑Compatible Software Should I Use?
HMRC requires you to use software that can create and store digital records and send quarterly updates to HMRC.
You can choose from:
- Full accounting software (records + submission) – e.g., Xero, Sage, QuickBooks, FreeAgent.
- Bridging software that works with spreadsheets.
- Hybrid setups (one product for records, another for submissions).
Check HMRC’s “find software” tool to ensure chosen software is recognised for MTD ITSA.
Do I need to report other income (e.g., PAYE, dividends) under MTD for ITSA?
Yes, but only on the final declaration at year‑end. Other income such as PAYE salary, pensions, dividends, and savings interest does not count toward the MTD income threshold, but it does need reporting when you submit your year‑end tax data through your MTD software.
Do I still need to file an annual tax return under MTD for ITSA?
Yes. MTD replaces the traditional annual tax return with a final declaration submitted through your MTD software after the last quarterly update. This final declaration completes your year’s income details and tax position with HMRC.
Will MTD for ITSA change when I pay my tax bill?
No. The timing and method of paying your income tax stays the same under MTD. You still pay your tax by the usual deadlines (for example, 31 January after the tax year). MTD changes how you report, not when you pay.
Can I use spreadsheets under MTD for ITSA?
Only if they are linked to HMRC‑compatible software. You cannot use spreadsheets alone. They must be connected (“digitally linked”) to approved software (often called bridging software) that submits your quarterly updates.
