HMRC may be signing you up for Making Tax Digital
Making Tax Digital for Income Tax became compulsory for the first group of sole traders and landlords from 6 April 2026.
HMRC is now taking the next step.
From September 2026, HMRC is starting to sign up people who it believes should already be using Making Tax Digital, but who have not registered themselves.
If you receive a notification from HMRC telling you that you have been signed up, it is important not to ignore it.
Who is affected?
For 2026/27, Making Tax Digital for Income Tax generally applies to sole traders and landlords whose qualifying income was more than £50,000 in 2024/25.
Qualifying income broadly means gross income from self-employment and property before deducting expenses. Other income, such as employment income, pensions and dividends, is not included when deciding whether the £50,000 threshold has been exceeded.
HMRC is using information it already holds to identify people who should be within the system.
That creates an important point. HMRC's information may not reflect changes that have occurred since the relevant tax return was submitted.
If HMRC signs you up and you believe you should not be within Making Tax Digital, the position should therefore be checked rather than simply assuming HMRC must be correct.
Being signed up is only the beginning
Automatic registration does not remove the practical work involved in Making Tax Digital.
Those within the system need compatible software and must create and maintain digital records of their self-employment or property income and expenses.
They must also use compatible software to send quarterly updates to HMRC.
More than 436,000 sole traders and landlords had successfully submitted their first quarterly update by 12 August 2026, according to HMRC.
If you should have submitted an update but have not yet done so, action should be taken. HMRC has confirmed that late quarterly updates will not attract late-submission penalties during 2026/27, although the outstanding updates still need to be submitted.
More people join next April
Even if Making Tax Digital does not apply to you this year, it may do so shortly.
From 6 April 2027, the qualifying income threshold falls to £30,000. Whether you need to join will therefore depend on your qualifying self-employment and property income for 2025/26.
This means some sole traders and landlords who are outside MTD at present have only a few months to prepare.
Waiting until next April before thinking about accounting software, digital record keeping and quarterly reporting could make the transition unnecessarily difficult.
If you have received an MTD communication from HMRC, or think you could be brought within the rules from April 2027, speak to us. We can check when the rules apply to you and help you prepare for the change.