HMRC’s current thresholds are over £50,000 from April 2026, over £30,000 from April 2027 and over £20,000 from April 2028, using the relevant earlier tax-year income. This is qualifying gross property and self-employment income, not rental profit.
Check whether the person is in scope
Making Tax Digital for Income Tax uses qualifying income rules. It is not decided by net rental profit alone.
- Check combined qualifying gross property and self-employment income against the applicable HMRC threshold and start year.
- The phased thresholds discussed are over £50,000 from April 2026, over £30,000 from April 2027 and over £20,000 from April 2028, subject to the current guidance and exceptions.
- Distinguish an individual's Income Tax position from a company's Corporation Tax obligations. Do not apply the same threshold to both.
Prepare the records and software
Agree the transition with the accountant or tax adviser before the first required reporting period.
- Identify compatible software and who maintains the digital records, checks transactions and makes submissions.
- Reconcile opening records, ownership shares, income streams and expense categories. Keep supporting invoices accessible.
- Check any exemption application or special circumstance through HMRC. Record the decision rather than assuming that unfamiliarity with software creates an exemption.
Keep reporting and final tax work distinct
Periodic updates do not remove the need to establish the correct tax position.
- Put the applicable submission dates and review responsibilities in a calendar.
- Review errors and adjustments through the correct process, preserving the audit trail.
- Confirm that the final return or year-end obligations are completed as required. A software upload notification is not proof that every tax obligation is finished.
Example: low profit but higher gross income
A fictional landlord receives £55,000 of qualifying gross rental income but has substantial expenses. Assess the MTD start requirement using the qualifying-income rules, not the smaller profit figure. The expenses still matter for calculating taxable profit.
What to do
- Use HMRC’s checker for the correct tax year and personal circumstances.
- Check exemptions and agree the record process with your accountant.
- Use recognised software for required submissions.
Evidence to keep
- Relevant tax return and eligibility decision
- Digital records and submission confirmations
Sources and guidance
- Who must use Making Tax Digital for Income TaxHMRC · checked 20 October 2026