Making Tax Digital for income over £30,000:
starts 6 April 2027

On 6 April 2027 Making Tax Digital for Income Tax reaches its second and largest group. Sole traders and landlords whose qualifying income was more than £30,000 for the 2025 to 2026 tax year must keep digital records and send quarterly updates from that date. HMRC estimates that around 1,077,000 more people will need to, more than joined in the first year.

The test is based on a return most of them will file by 31 January 2027, which means the answer to "am I in?" is being settled now. This page explains how the threshold works, what counts towards it, and what to have in place before the first deadline.

“From 6 April 2027, around 1,077,000 more sole traders and landlords will need to create digital records, send quarterly updates and submit their tax return using software that works with Making Tax Digital for Income Tax.”

The thresholds, year by year

Making Tax Digital for Income Tax is arriving in three steps, each based on an earlier year's tax return. The figures are set in law, in regulation 27 of the Income Tax (Digital Obligations) Regulations 2026.

Each step adds people; nobody leaves when the threshold drops. Someone who joined in April 2026 stays in, and from April 2028 the £20,000 threshold applies to every later year too. Once you are using the service, GOV.UK says you can choose to opt out if your qualifying income stays below the relevant threshold for three tax years in a row.

Sole traders and landlords brought into Making Tax Digital

• In scope from April 2026 (over £50,000)864,000+
• More from April 2027 (over £30,000)1,077,000

What qualifying income is

Qualifying income is your total income from self-employment and property before expenses. GOV.UK calls it turnover. It is based on the tax return for the year being tested, so for the April 2027 group, the 2025 to 2026 return.

HMRC's worked example: £25,000 from rental income and £27,000 from self-employment makes qualifying income of £52,000. Neither figure alone would have crossed the first threshold, but together they do. The same logic applies at £30,000. A part-time trade earning £18,000 and a flat let for £14,000 add up to £32,000.

What does not count:

• employment income taxed through PAYE;
• your share of profit from a partnership, as an individual partner;
• dividends, including from your own company;
• the State Pension and private pensions.

Some smaller items are excluded too, such as qualifying care relief receipts and certain one-off transactions in UK land, which GOV.UK lists in full.

Allowances and expenses

Qualifying income is measured before anything is deducted. HMRC's October 2026 press release puts it directly: turnover includes gross income from self-employment and property before any tax allowances or expenses are deducted. Claiming the £1,000 trading allowance or property allowance on your return does not lower your turnover for this test.

That catches people whose profit is modest but whose turnover is not. A delivery driver who takes £34,000 in a year and spends £9,000 on fuel and vehicle costs has a profit of £25,000 and qualifying income of £34,000. They are in.

Joint property owners

Your share of the property income counts. GOV.UK's example is a property generating £50,000 in income, shared equally, which gives each owner qualifying income of £25,000. If you only receive notice of your share after expenses have been deducted, HMRC uses that figure.

More than £30,000, not £30,000 or more

The rule is more than £30,000. The regulations exempt anyone whose qualifying income is not more than the qualifying amount, so a turnover of exactly £30,000 is outside the April 2027 group. At £30,001 you are in.

Will HMRC tell you?

HMRC says it reviews your Self Assessment return and checks your qualifying income each year, and if your income is above the relevant threshold it will write to you confirming that you need to start using Making Tax Digital by the start of the following tax year. HMRC has not published when the letters for the April 2027 group will go out.

The letter is a courtesy, not a condition. GOV.UK is explicit that if you did not receive a letter, it is still your responsibility to check if and when you need to use the service. In the first year HMRC began signing people up itself from September 2026, months after the start date. It has not said whether it will do the same for the April 2027 group, so plan to sign up yourself.

Worked examples: in or out

Each example uses the 2025 to 2026 return, the one HMRC tests for the April 2027 group.

Three things decide most cases. Salary is never counted, so a teacher with a flat is tested on the rent alone. Expenses are never deducted, so the courier with a profit of £21,000 is in on turnover of £33,500. And joint owners count their share, so the joint landlord is tested on £25,000, not £50,000.

Someone just under the line in 2025 to 2026, like the hairdresser, is not in from April 2027, but their 2026 to 2027 turnover is tested against £20,000 for April 2028. At £29,500 they will almost certainly be in a year later, so there is little to gain from waiting to set up.

Before 6 April 2027

1. File your 2025 to 2026 return by 31 January 2027. It is the return HMRC tests, and you need to have submitted a return in the last two years to sign up. The page on 31 January 2027 covers it.
2. Work out your qualifying income from that return: self-employment turnover plus property income, before expenses. The MTD requirement checker does the sum, and mtd-check walks through it step by step.
3. Choose software that covers your income types: self-employment, UK property, foreign property, or a mix. The HMRC software directory shows what each product supports.
4. Sign up for Making Tax Digital for Income Tax. HMRC says you must be registered for Self Assessment and have submitted a tax return in the last two years.
5. Start digital records on 6 April 2027, or 1 April 2027 if you choose calendar update periods.

The first year for the £30,000 group

The quarterly dates follow the rule in the regulations, the same every tax year. The tax return is due by 31 January after the end of the tax year, as for every Self Assessment return.

Penalties from the first update

The no-points easement HMRC gave for 2026 to 2027 is written for that tax year. GOV.UK's guidance does not describe the same easement for people joining in April 2027, and HMRC's August 2026 press release says points-based penalties apply where taxpayers miss a quarterly deadline from 6 April 2027 onwards. Plan on the basis that 7 August 2027 counts: one point per missed deadline, £200 at 4 points.

For late payment, there is a first-year allowance: GOV.UK says that in your first year of the new penalties you have 30 days from the payment due date to pay in full or contact HMRC about a payment plan before penalties begin.

For sole traders, landlords and gig workers

Sole traders with more than one trade add the turnover of every trade together. Each trade then sends its own quarterly update.

Landlords count rent from every property, UK and overseas, plus self-employment income if they have it. Joint owners count their share only.

Gig and platform workers often have the largest gap between turnover and profit. Use the earnings figures on your platform statements, not what you kept after costs. The guide to Making Tax Digital for sole traders covers the record-keeping side in more detail, and the glossary explains turnover.

What the first year showed

HMRC's own figures from the first year are a useful guide to what the April 2027 group can expect. In July 2026 it said more than 864,000 sole traders and landlords were in scope. By 12 August 2026, more than 570,000 had signed up and more than 436,000 had sent their first quarterly update. From September 2026, HMRC began signing up the people in scope who had not done it themselves, in stages over the following months, and then contacting them to confirm it.

The lesson for the second group is about timing rather than difficulty. The people who signed up early and kept records from April sent their first update without fuss; the people HMRC signed up in the autumn started with overdue updates and months of records to catch up. With no penalty-free year described for 2027 to 2028, starting late carries a real cost for the April 2027 group, so the time to set up is before 6 April, not after the first letter.

What comes after

From 6 April 2028 the threshold drops again, to £20,000 on the 2026 to 2027 return. The April 2028 page covers that group. Every date is on the deadlines hub, and the sole trader tax calculator estimates your bill once your first figures are in.