Making Tax Digital: HMRC Letters Going Out Ahead of April 2026 Changes
HMRC has started writing to taxpayers to help them prepare for the upcoming Making Tax Digital (MTD) for Income Tax rules, which come into force in April 2026.
What Is Making Tax Digital?
Making Tax Digital for Income Tax changes how sole traders and landlords record and report their business income to HMRC.
Under the new system, you will need to:
Keep digital accounting records using compatible software
Submit quarterly updates to HMRC through that software
From 6 April 2026, MTD will become mandatory for almost all sole traders and landlords with gross income above £50,000 in the 2024/25 tax year.
Why You May Have Received a Letter
HMRC is contacting taxpayers whose 2024/25 returns have already been filed and show more than £50,000 in combined self-employment and/or rental income.
Even if you haven’t received a letter, the rules still apply if your income for 2024/25 exceeds the £50,000 threshold. HMRC’s letters are simply a prompt, not the deciding factor.
What You Should Do Next
1. Check whether you may be exempt
A small number of taxpayers may qualify for exemption — for example, if it’s not reasonable for you to use digital accounting software. If you believe this applies to you, you can apply, and HMRC will confirm their decision.
2. Choose compliant software
You’ll need MTD-compatible software to keep records and file quarterly reports. If you already use accounting software, confirm with your provider that it’s MTD-ready.
3. Sign up for Making Tax Digital
You can complete the sign-up process through GOV.UK once your software is in place.
Need Support Getting Ready?
If you’re unsure about the rules, need help choosing the right software, or want us to handle the full MTD process for you, the Alera team is here to help.
From practical guidance to complete digital bookkeeping support, we’ll make sure you’re fully prepared for April 2026.