The below information will only be relevant to those of you with rental income or self-employed income.
Specifically, it only relates to those of you with gross income (income before any expenses have been taken into account) of at least £30,000 across one or both of these forms of income. If this applies to you or if you have a gross profit of £20,000 or more across one or both of these forms of income, please read on to see how this affects you.
Make Tax Digital (MTD) for Income Tax is a government initiative aimed at digitising the tax process. HMRC’s aim is for, more frequent, and more accurate reporting of tax information. If MTD applies to you, you must start using MTD from April 2026. But don’t worry we’re here to help.
Who does this affect:
- Landlords with an annual income over the threshold
- Self-employed individuals with an annual income over the threshold
- Those who are both landlords and self-employed will use their combined income from both of these sources when calculating if they meet the threshold.
What is the current MTD thresholds:
- £50,000 gross income from April 2026
- £30,000 gross income from April 2027
- £20,000 gross income – date TBC
What changes?
- Digital Record Keeping: You must keep digital records of income and expenses using MTD-compatible software.
- Quarterly Updates: Instead of one annual tax return, 3 quarterly updates need to be submitted with a final declaration to HMRC at the year end.
What to do if the above applies to you?
- Get in touch with us at CrewFO to schedule a call on how we can best assist you: https://calendly.com/hello-crewfo/crewfocall
- Begin keeping digital records of both sales and expenses.