News from 30 March 2026
Read the current Making Tax Digital guide.
HMRC updated Making Tax Digital guidance shortly before the first group of landlords and sole traders joined in April 2026. The changes clarified the income test and the requirements for digital records and quarterly updates.
What has changed
On 26 March, HMRC updated its guidance on checking whether you need to use Making Tax Digital for Income Tax. The online tool now asks about the 2026 to 2027 tax year and exemptions, which should help landlords work out whether they are in scope and when they need to start.
On 27 March, HMRC also updated the publications covering digital record-keeping and quarterly updates. The main change was to bring the wording into line with the new Income Tax (Digital Obligations) Regulations 2026. References to older “notices” have been replaced with “directions”, and the documents now sit more clearly alongside the regulations that come into force on 1 April 2026.
The timetable itself has not changed. Landlords with qualifying income above £50,000 in the 2024 to 2025 tax year are due to start from 6 April 2026. The next phases are set for income above £30,000 from April 2027 and above £20,000 from April 2028.
How the change affects a landlord
The updated pages are useful because they clarify what counts towards the threshold and what HMRC expects once a landlord is in the system. HMRC says qualifying income is based on gross income from self-employment and property before expenses are deducted. If a landlord also has self-employment income, those amounts are added together for threshold purposes. If a property is jointly owned, only the landlord’s share counts towards their qualifying income.
Use income before costs and include the relevant income sources when checking the threshold. The updated sign-up guidance also says that landlords who need to use Making Tax Digital from 6 April 2026 should sign up before that date, and that anyone signing up must be registered for Self Assessment and have submitted a tax return in the last two years. If a landlord uses an agent, the agent can handle the sign-up instead.
Digital records and quarterly updates
The refreshed quarterly update and digital record-keeping directions are not dramatic reading, but they underline that HMRC’s focus is on process. Compatible software must be used to keep and correct digital records, submit quarterly updates and deliver returns through HMRC’s systems.
The record-keeping direction highlights some groups that need special attention, including joint property owners, retailers and customers below the VAT registration threshold. Joint ownership can affect the income test and the records you need.
The quarterly update direction reinforces that landlords in scope will be expected to send income and expense information during the year rather than leaving everything until the usual Self Assessment deadline. HMRC has said there will be no penalty points for late quarterly updates in the first tax year for those mandated from April 2026, but other penalties can still apply, including around tax returns and late payment.
Sources
- GOV.UK: Find out if and when you need to use Making Tax Digital for Income Tax
- GOV.UK: Work out your qualifying income for Making Tax Digital for Income Tax
- GOV.UK: Sign up for Making Tax Digital for Income Tax
- GOV.UK: Digital record-keeping direction for Making Tax Digital for Income Tax
- GOV.UK: Making Tax Digital for Income Tax: Quarterly update direction
- legislation.gov.uk: The Income Tax (Digital Obligations) Regulations 2026
