HMRC expects that more than one million taxpayers will be required to use digital recordkeeping and send quarterly updates to HMRC when the second phase of Making Tax Digital (MTD) for Income Tax is extended to individuals with qualifying self-employment and property income over £30,000 from 6 April 2027.
With HMRC data suggesting that 37% of this cohort do not have an authorised agent, this could represent a significant shift in how taxpayers are dealing with HMRC, and how frequently. HMRC are encouraging taxpayers to start preparing now so they can ensure details are correct and have time to choose the best software for them.
Craig Ogilvie, HMRC's Director of Making Tax Digital, commented:
'Signing up now means you can prepare and familiarise yourself with the process before it becomes mandatory next April.'
Those with income in excess of £50,000 have been mandated into MTD since April 2026; for them, the next milestone is the second quarterly update due on 7 November 2026. From September 2026, HMRC has started to automatically enrol anyone who should be using MTD for Income Tax for 2026/27 but has not yet signed themselves up.
The next phase of the MTD rollout will be to extend to sole traders and landlords with income in excess of £20,000 from April 2028.
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