From April 2026, if you earn income from property or self-employment and your total gross income is more than £10,000 a year, you’ll have to start reporting your taxes to HMRC in a very different way.

You may have heard of this change already. It’s called Making Tax Digital for Income Tax, or MTD for short. But what does it actually mean for you? And what should you be doing now to get ready?

At Vectigalis Tax, we’re already helping clients prepare behind the scenes—and we want to share a few important insights with you so you’re not caught off guard when the rules change.

Why is this happening?

HMRC wants to modernise the tax system. Instead of submitting one tax return a year, people with property or self-employed income above £10,000 will soon need to:

• keep digital records, 
• send quarterly updates to HMRC (yes, four times a year),
• and submit a final annual statement.

So if you’re a landlord, a sole trader, or both, this change could apply to you—and it’s closer than you think.

Maria’s story: a landlord’s new reality

Take Maria, one of our clients. She owns two rental flats in Manchester, generating about £18,000 a year in gross income. Like many, she assumed her accountant would continue to handle everything once a year. But with MTD, Maria will need to keep her rental records digitally and report her income every three months.

It sounded daunting—until we explained how we could guide her through it step by step. Now she’s already using MTD-compatible software, and by the time the new rules arrive, it’ll feel like second nature.

What if you own a property with someone else?

This part can be confusing. If you own a property jointly—say, with a spouse or sibling—you’ll each need to report your own share of the rental income and expenses under MTD.

Unless you’ve formally set up a partnership (and HMRC has very specific rules about what counts), you’ll both be treated as individuals for tax purposes. So digital recordkeeping and quarterly updates will apply to each of you.

What you can do now

Even though the start date is April 2026, it pays to be prepared early. Here’s what we recommend:

1. Find out if you’ll be affected

Look at your gross income—not your profit—from rental property or self-employment. If it’s more than £10,000 a year, MTD applies to you. We can help you check this if you’re unsure.

2. Start keeping digital records

You don’t need to submit anything to HMRC yet, but if you begin using MTD-ready software now, you’ll have plenty of time to get comfortable with it.

3. Ask your accountant about your software

Don’t assume that the software you use for VAT (if you’re registered) will work for MTD for income tax. The two systems are different. At Vectigalis Tax, we’ve already tested several solutions and can recommend one that suits your setup.

4. Join an HMRC webinar  

HMRC is running webinars to help people understand MTD. We can walk you through the main points, or you can watch the sessions yourself on GOV.UK.

5. Use this year as a dress rehearsal

The 2024/25 tax year is a great chance to practise. Even though you won’t have to file quarterly updates yet, we can help you simulate what MTD would look like—so there are no surprises later.

What if you do nothing?

In truth, you’ll still have to comply when the time comes. But if you wait until the last minute, the process will feel rushed and more stressful than it needs to be. You might face penalties for missing deadlines or struggle with unfamiliar software under pressure.

That’s why we’re encouraging all our clients to take small steps now—while there’s still time to adjust.

We’ll make it manageable

At Vectigalis Tax, we’re here to help you navigate MTD without the stress. Whether you’re a landlord, freelancer, or managing several properties, we’ll break things down, recommend tools that work, and make sure your reporting is accurate and compliant.

You don’t have to figure it all out alone.

If you’d like to talk about your specific situation, or get started with a plan, just get in touch.