There are ongoing discussions surrounding MTD ITSA, with the goal posts being moved and adjustments still being made. However, below is what we have found so far:

MTD ITSA will start affecting those whose total income (before deductions) from self-employment/rental property income exceed £50,000. They will have to start reporting digitally from April'26, with those who's income is above £30,000 & below £50,000 starting from April'27.  The Government currently intends to lower this threshold again to £20,000 before their term is up by 2029.

It is important to state that this is self-employment and rental income, therefore if you have £25,000 from rental property income & £27,000 from self-employment, your total qualifying income is £52,000. Meaning you would need to report from April'26. 

If you have rental property income from a property in joint names, you would only take your percentage of profits as qualifying income.

The kind of information that will need to be kept digitally are:

• Amounts

• Dates this occurred

• The category this falls into, however this part can be dealt with via your agent if you use one

There are 2 options with MTD ITSA for the frequency of reporting, the set standard that will automatically be applied is the quarterly basis:

Q1 - 6th April to 5th July, due 7th August

Q2 - 6th July to 5th October, due 7th Nov

Q3 - 6th October to 5th Jan, due 7th Feb

Q4 - 6th Jan to 5th April, due 7th May

You can elect to make your submission via a 'calendar quarter' instead:

Q1 - 1st April to 30th June, due 7th August

Q2 - 1st April to 30th Sep, due 7th Nov

Q3 - 1st April to 31st Dec, due 7th Feb

Q4 - 1st April to 31st March, due 7th May

Meaning the 1st quarterly submission under MTD ITSA will be 7th Aug'26 covering the period ending either 5th July'26 or 30th June'26 depending on what reporting period you choose.

Should you wish to use the calendar quarter instead, an application to choose this needs to be made to HMRC no later than the quarterly deadline for period 1.

You are able to make your quarterly submission 10 days prior to the end of the reporting period provided that you are confident that the information being reported will not change & covers everything required.

You are able to check on what companies are currently providing MTD ITSA compatible software via this link: https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax

We cannot stress this enough, please do your own research if you want to get your own compatible software. If you are able to try it for free for a period please take advantage of this. We come across so many individuals that pay over the odds for software that just isn't relevant for their needs.