Making Tax Digital for Income Tax is one of the biggest tax admin changes affecting sole traders and landlords.
From 6 April 2026, sole traders and landlords must use Making Tax Digital for Income Tax if their total annual income from self-employment and property is over £50,000. GOV.UK says the threshold applies to total annual income from self-employment and property, not just profit.
This means some people who currently deal with tax once a year through Self Assessment may need to keep digital records and send updates to HMRC using compatible software.
Quick Answer: Who Has to Use Making Tax Digital in 2026?
You may need to use Making Tax Digital for Income Tax from 6 April 2026 if:
- you are a sole trader
- you are a landlord
- your total annual income from self-employment and property is over £50,000
- you are required to report through Self Assessment
The rules are expected to extend to lower income thresholds later, so people below the first threshold should still keep an eye on future changes.
What Will You Need to Do?
If you are required to use Making Tax Digital, you will need to use compatible software to:
- keep digital records
- record self-employment income and expenses
- record property income and expenses
- send quarterly updates to HMRC
- submit your final tax return information
- pay tax due by the normal deadline
GOV.UK says MTD-compatible software will be needed to create, store and correct digital records and send quarterly updates to HMRC.
Does This Affect Landlords?
Yes, it can.
Landlords may be affected if their property income, or combined property and self-employment income, is over the relevant threshold.
This is why Making Tax Digital matters for small landlords as well as sole traders.
Landlords may need to keep clearer digital records of:
- rent received
- repairs and maintenance
- letting agent fees
- insurance
- mortgage interest
- service charges
- accountancy costs
- other allowable expenses
Does This Affect Sole Traders?
Yes.
Sole traders over the threshold may need to move from once-a-year record gathering to a more regular digital system.
This may affect:
- tradespeople
- freelancers
- consultants
- delivery drivers
- online sellers
- local service businesses
- side businesses that have grown
The key issue is not only tax owed. It is record keeping.
Making Tax Digital 2026 FAQs
When does Making Tax Digital start?
Making Tax Digital for Income Tax starts from 6 April 2026 for sole traders and landlords over the first income threshold.
What is the 2026 MTD income threshold?
The first threshold is total annual income from self-employment and property over £50,000.
Is the threshold based on profit?
No. GOV.UK guidance refers to total annual income from self-employment and property, not just profit.
Do landlords need Making Tax Digital?
Some landlords will. It depends on their income and whether they meet the threshold.
Do I need special software?
Yes, if you are required to use Making Tax Digital, you will need software that works with MTD for Income Tax.
Final Thought
Making Tax Digital 2026 is not just a tax deadline. It is a record-keeping change.
If you are a sole trader or landlord near the threshold, it may be worth checking your income, reviewing your records and preparing early rather than waiting until the deadline is close.
For MTD, cite/link official GOV.UK guidance because this is rule-based and current. GOV.UK says MTD for Income Tax applies from 6 April 2026 to sole traders and landlords with total annual self-employment and property income over £50,000, and that compatible software is needed for digital records and quarterly updates.