Making Tax Digital: What It Means for the Self-Employed and Landlords

A practical guide from Davis & Co. LLP. Approved HMRC Tax Agents.

Introduction

MTD for the Self-Employed and Landlords
Making Tax Digital (MTD) is the biggest change to the UK tax system in a generation. From April 2026, many self-employed individuals and landlords will need to keep digital records and submit quarterly updates to HMRC instead of just filing a single annual tax return.
At Davis & Co LLP, we know this transition can feel daunting – especially for those who have always filed online themselves or are less confident with new technology.

This page sets out:

  • The key rules and exemptions.
  • What changes HMRC is introducing.
  • Why free HMRC filing tools are disappearing.
  • The role of HMRC-approved agents like Davis & Co LLP.
  • The practical steps you can take now to stay compliant and in control.

1. What Is Making Tax Digital (MTD)

  • HMRC’s initiative to modernise the UK tax system.
  • Designed to reduce errors and improve efficiency.
  • Requires taxpayers to keep digital records and file updates directly from compatible software.

2. Who Is Affected and When?

  • Self-employed individuals earning over £30,000
  • Landlords with property income above £30,000
  • Partnerships will follow later 

Eventually, the regime will cover most taxpayers.

Timetable for Making Tax Digital

  • April 2026: Self-employed and landlords with income over £50,000 must join MTD.
  • April 2027: Self-employed and landlords with income over £30,000 must join MTD.
  • Below £30,000: Currently deferred — but HMRC has confirmed this group will be included in future phases.

(Note: Partnerships and other taxpayers are expected to follow later, though HMRC has not confirmed dates.)

  • Self-employed individuals with gross business turnover above the thresholds.
  • Landlords with gross property income, including:
  • Overseas rental properties (not just UK).
  • Joint holdings – the share of income before expenses counts towards the threshold.
  • Partnerships and others will follow in later phases.
  • The threshold test is based on gross income, not net profit.
  • If you own property jointly (e.g. with a spouse or family member), your share of the gross rents is included when testing against the £30k / £50k thresholds.
  • Foreign rental income is also included when calculating total relevant income.

Gain financial stability and profitability through expert cash flow management.

3. Key Rules and Exemptions

  • Quarterly submissions: Every 3 months, taxpayers must send digital updates.
  • Annual finalisation: An End of Period Statement (EOPS) and Final Declaration will still be required.
  • Exemptions:
  • Income below £30,000.
  • Digitally excluded taxpayers (e.g. age, disability, or no internet access).
  • HMRC approval required for exemption.

4. Why the Current Online Portal Is Disappearing

  • The HMRC “free filing portal” will be withdrawn.
  • Filing must now be through MTD-compatible software.
  • HMRC is not providing free software — instead, taxpayers must use commercial packages.

5. The Role of HMRC-Approved Agents

  • HMRC is registering and recognising professional firms to act as authorised tax agents.
  • Davis & Co LLP is fully approved and already supports hundreds of clients through this transition.
  • Agents can:
  • Submit updates on behalf of clients.
  • Recommend and set up appropriate software.
  • Provide training and ongoing support.

6. Choosing the Right Software

  • Different taxpayers have different needs. We regularly work with:
  • Xero – ideal for businesses needing full bookkeeping.
  • FreeAgent – simple solution for small businesses.
  • Hammock and Landlord Vision – tailored to landlords managing property income.

Our team helps you select, set up, and use the right package.

  • xero logo
  • freeagent logo
  • hammock logo
  • landlord vision logo

7. Challenges for Mature and Less Tech-Confident Taxpayers

  • Many taxpayers who have always “done it themselves” may now feel excluded.
  • Digital records and quarterly filing require new habits.
  • HMRC has said penalties will be light at first, but non-compliance will not be ignored.
  • Early preparation reduces stress and avoids last-minute problems.

8. Why Act Now?

  • Time is short — 2026 will arrive quickly.
  • Software takes time to learn and get used to.
  • Spreading the transition now avoids a rush later.
  • Davis & Co LLP has capacity to take on new clients and guide existing ones smoothly.

9. How Davis & Co LLP Can Help

  • Approved HMRC tax agents with decades of experience.
  • Large and diverse client base — from sole traders to landlords with multiple properties.
  • Practical support with:
  • Software selection and setup.
  • Training and troubleshooting.
  • Filing quarterly returns and annual submissions.
  • Peace of mind: we ensure you stay compliant while focusing on your business.

Conclusion

Making Tax Digital will transform the way tax is reported. While HMRC sees this as progress, it brings real challenges for self-employed people and landlords — especially those unfamiliar or unwilling to adapt to digital record-keeping.

The good news is that with the right guidance and tools, the transition can be straightforward. Davis & Co LLP is here to ensure you are not left behind.

Next Step: Book a free consultation with our MTD team today and let us guide you through the changes.

To read more on MTD for ITSA, follow our blog: Making Tax Digital

Introduction

What Is MTD?

Who Is Affected And When?

Key Rules and Exemptions

Why the Current Online Portal Is Disappearing

The Role of HMRC-Approved Agents

Choosing the Right Software

Challenges for Mature and Less Tech-Confident Taxpayers

Why Act Now?

How Davis & Co LLP Can Help

Conclusion

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