Making tax digital for ITSA – the latest updates for 2025 and beyond

Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) is one of the biggest changes to the UK tax system in recent years. It affects self-employed individuals and landlords across the country, with phased rollout dates beginning in April 2026.

If you’ve read about MTD for ITSA before, you might have seen different start dates or requirements. That’s because HMRC has refined the rules since the original announcement. Here’s the latest, up-to-date guidance as of mid-2025.

Who does MTD for ITSA apply to?

MTD for ITSA applies to self-employed sole traders and landlords with combined gross qualifying income (before expenses) from self-employment, UK property, and overseas property above certain thresholds.

Key dates and thresholds:

• From 6 April 2026: Income £50,000+ → MTD mandatory.
• From 6 April 2027: Income £30,000+ → MTD mandatory.
• From 6 April 2028: Income £20,000+ → MTD mandatory (newly confirmed).

Thresholds are determined from the most recent tax return before each rollout year.
For example:

• April 2026 start is based on your 2024/25 return.
• April 2027 start is based on your 2025/26 return.

Exemptions and special cases

Some individuals are outside the scope of MTD for ITSA, including:

• Those without a valid National Insurance Number.
• Foster carers (in respect of qualifying care income).
• Estates (executors of deceased taxpayers).
• Lloyd’s members (exempt until at least April 2029).
• Those digitally excluded for reasons such as age, disability, remote location, or religious beliefs (requires HMRC approval).

Partnerships — including LLPs — are not yet included, though HMRC has signalled future expansion.

Reporting requirements – quarterly and year end

Under MTD for ITSA, affected tax payers will need to:

1. Submit four quarterly updates via HMRC – compatible software
2. File an end of period statement (EOPS) for each income source
3. Submit a final declaration – replacing the self assessment tax return – that covers all income for the year, including non business income.

Quarterly updates must be submitted within one month of each standard period’s end. The deadlines are:

Digital record keeping

All relevant records must be stored digitally using HMRC-approved software. Examples include FreeAgent, Xero, and QuickBooks — though HMRC publishes a full list on its website.

Keeping records digitally helps reduce errors, ensures information is always backed up, and makes submitting returns easier.

Summary – What’s changed since early 2024

• £20,000 threshold from April 2028 is now confirmed
• Partnership remain excluded with no start date yet
• Contrary to some earlier reports, the end of period statement (EOPS) is still required

Final thoughts

MTD for ITSA is a major shift in how millions of tax payers will report their income. While 2026 might seem far away, preparing early, choosing the right software, digitising your records and understanding deadlines will make the transition much smoother.

If you are unsure whether you are in scope or need help setting up MTD ready software, our tax and business outsourcing team can guide you through the process.

You can also take a look at our making tax digital hub for all the latest MTD developments and insights.