MTD for ITSA: What’s new?

This is your reminder that from 6th April 2026, self-employed individuals and landlords with income over £50,000 will be required to comply with Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA). If this includes you, it’s time to start preparing.

Since our last update on MTD in May, HMRC has announced several key developments, so in this month’s blog we’re providing you with a quick breakdown of what’s new and what these changes mean for you.

Who’s now exempt or deferred?

There have been some delays to the MTD rules – if you fall into one of the groups below, you are either exempt, or your start date has been pushed back:

  • Ministers of religion
  • Lloyd’s underwriters
  • Recipients of: Blind Person’s Allowance, Married Couple’s Allowance
  • Individuals with a registered Power of Attorney
  • Non-UK resident entertainers/sportspeople (with no other UK income)
  • Foster carers and others earning qualifying care income

Implementation timeline:

Deferred to April 2029:

Ministers, underwriters, married couple/blind allowance recipients

Deferred to April 2027:

Those using SA109 (residence/remittance basis)

Permanently exempt:

Power of Attorney holders, non-resident entertainers/sportspeople

Digital access issues?

Some exemptions apply if HMRC cannot reasonably offer digital access – you will need to apply and meet their criteria.

What this means for you:

You may not need to follow MTD rules at all – or at least not for a few more years. That could mean less admin, fewer reporting obligations, and more time to prepare!

Good news for corporates

If you run a limited company, you can relax – corporation tax isn’t going digital anytime soon!

“Legislation Day” - July 2025

Legislation day took place on 21 July this year, when HMRC published draft legislation outlining the next phase of MTD. Here’s what was covered:

  • New ‘latency’ rule introduced:

A grace period will apply before MTD rules kick in for any new business or property income.

How it works:
If you start a new self-employed business or start receiving property income, you won’t need to follow MTD rules for that income straight away.

When MTD applies:
You’ll start complying with MTD from 6 April following the tax year in which that new income first appears on your tax return.

If this applies to you – here’s what it means:

This will take the pressure off in the early stages – you’ll have time to get your new business or property venture up and running before needing to switch to digital record-keeping.

Other key updates:

  • Year-end reporting process will be simplified
  • New exemptions and deferrals (as outlined above) are being formalised
  • The income threshold for MTD will officially lower to £20,000 from April 2028

What you should do now:

Firstly, early preparation is key – even if you’re not affected yet. We recommend to:

Catch up on our full MTD Q&A

We answered all the key MTD questions in our May blog. If you haven’t read it yet, you can revisit the full Q&A here

Why not give us a follow on socials for more insights and expert financial advice?

Let's get down to business!

Trusting our people
Delivering the services you need

Request a call-back
Contact us online