Making Tax Digital for Income Tax starts 6 April 2026. That's 22 days.
If you earn over £50k from self-employment and you haven't sorted this yet, stop reading and do the checklist below. The penalty exemption for the first year is real but don't rely on it — you still need to be registered and using compatible software.
The Actual Last-Chance Checklist
✅ 1. Confirm you're affected
MTD for ITSA applies if your qualifying income (self-employment + property combined) exceeds £50,000 in the 2024-25 tax year.
This is gross income, not profit. If you freelance and also rent a flat, both count.
If you're below £50k: you're not affected until April 2027 (£30k threshold) at the earliest. Stop panicking.
✅ 2. Register with HMRC for MTD
If you haven't signed up yet, go to HMRC's website and register for Making Tax Digital for Income Tax. You need:
- A Government Gateway account
- Your UTR (Unique Taxpayer Reference)
- Compatible software before you register (see step 3)
Don't register until you have software — the registration process links directly to your chosen software.
✅ 3. Pick your software
MTD-compatible options for freelancers:
| Software | Monthly cost | Best for |
|---|---|---|
| FreeAgent (via NatWest/Mettle) | Free | Sole traders with simple finances |
| Xero | £15-£33/mo | Growing businesses, complex finances |
| QuickBooks Self-Employed | £8/mo | Simple freelancers who already use it |
| QuickFile | Free | Very basic needs |
| FreshBooks | £12/mo | Invoicing-heavy freelancers |
If you're a developer earning over £50k, you probably have more than "simple finances." Budget for Xero or QuickBooks — the time saved on reconciliation pays for itself.
✅ 4. Start keeping digital records NOW
This is the part people underestimate. MTD doesn't just change how you submit — it changes how you record.
Every income and expense needs to be logged digitally, in compatible software, as it happens (or close to). Not in a spreadsheet at year-end. Not on paper.
Start this week. Import your transactions if you can. Most software connects to your bank and pulls in data automatically.
✅ 5. Understand quarterly deadlines
Your first quarterly update will be due:
- 5 August 2026 (covering April–June 2026)
Then:
- 5 November 2026 (July–September)
- 5 February 2027 (October–December)
- 5 May 2027 (January–March)
Plus a final declaration (replaces your annual return) by 31 January 2028.
You don't need to do anything extra for the first quarter if you register before April 6 — the software handles the submission.
The Bit Everyone Misunderstands
MTD quarterly updates are not full tax returns. They're just totals — your income and expenses for the quarter. No detailed breakdown required. The software generates and submits it automatically.
The final declaration at year-end is where you add anything the software doesn't capture: savings interest, pension contributions, Gift Aid, etc.
First year penalty exemption: HMRC won't penalise you for errors in the 2026-27 year if you're clearly trying. But you still need to be signed up and submitting.
If You're Not Affected Yet
If you're under £50k, you have time — but use it. Start using MTD-compatible software voluntarily now. By the time the threshold hits your income bracket, you'll already have a year of clean digital records.
The freelancers who'll struggle most in April 2026 are the ones who've been recording everything in spreadsheets and are now trying to migrate. Don't be that person in 2027.
Free Check
There's a free MTD readiness checker at landolio.com/tools/mtd-readiness-checker — takes 2 minutes to tell you exactly where you stand.
If you want a full step-by-step guide covering software costs, common mistakes, and how to stay compliant without losing your mind: MTD Readiness Toolkit (£14).
22 days. Do the checklist.
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