Making Tax Digital: What Self‑Employed Workers Need to Know for 2026

Rob Wilks
Mar 20
2 min read

The UK tax system is undergoing one of its biggest modernisations in decades, and from 6 April 2026, many self‑employed individuals will see changes in how they report their income. These changes fall under Making Tax Digital for Income Tax Self Assessment (MTD) — HMRC’s plan to replace the traditional annual tax return with quarterly digital updates.

MTD aims to reduce tax errors, improve accuracy, and help taxpayers stay on top of their finances throughout the year. HMRC estimates that mistakes in manual record‑keeping are a major contributor to the Self Assessment tax gap.

Who will be affected?

MTD for Income Tax is being rolled out in phases:

From April 2026: Self‑employed individuals and landlords with qualifying income over £50,000 must comply.
From April 2027: The threshold drops to over £30,000.
From April 2028: It drops again to over £20,000.

HMRC combines all your self‑employment and property income. For example, if you earn £28,000 from self‑employment and £24,000 from rental income, your total £52,000 puts you into the April 2026 bracket.

What’s changing?

1. Digital Record‑Keeping Becomes Mandatory

You must keep digital records using HMRC‑compatible software — paper records or unlinked spreadsheets won’t be acceptable.

2. Quarterly Reporting Replaces the Annual Return

Instead of submitting one tax return by January31st, you’ll need to send quarterly updates of income and expenses to HMRC. These aren’t separate tax returns, just snapshots of your year‑to‑date position.

Typical reporting quarters are:

6 April – 5 July
6 July – 5 October
6 October – 5 January
6 January – 5 April

3. An End‑of‑Year “Final Declaration”

Instead of the Self Assessment tax return, you’ll confirm final income figures after the year ends.

Important:

MTD changes how you report tax, not when you pay it — payment deadlines remain 31 January and 31 July.

What you should do now

Check your income level based on your 2024/25 Self Assessment to see when your obligation begins.
Choose compatible software - HMRC will not provide its own.
Organise your bookkeeping - especially if you have multiple income stream.

Reach out to our accountancy partner, Gorilla Accounting who will be able to help you navigate these changes and submit the relevant information on your behalf.