The first phase for Making Tax Digital (MTD) for Income Tax is nearly upon us, as the new system of digital tax reporting commences from 6 April 2026.<\/p>\n
<\/p>\n
However, some landlords, self-employed individuals or sole traders may still wondering whether the rules apply to them and if they could be exempt.<\/p>\n
Not knowing if you are exempt by now could put you at risk of rushed submissions and not having enough time to prepare.<\/p>\n
While HMRC has confirmed that exemptions do exist, the reality is that most people will not qualify.<\/p>\n
If you do believe that yourself or someone you support may be exempt, you must act quickly.<\/p>\n
MTD for Income Tax applies to landlords, self-employed individuals and sole traders with a qualifying income from self-employment or property.<\/p>\n
From 6 April 2026, individuals with a qualifying income of \u00a350,000 or more based on their 2024\/25 tax return will be affected. Those who qualify will need to keep digital records and submit quarterly updates using MTD-compatible software.<\/p>\n
The thresholds will fall to \u00a330,000 in April 2027 and \u00a320,000 in April 2028 and more people will be affected by MTD over the next few years.<\/p>\n
Landlords, self-employed individuals and sole traders should assess their qualifying income before expenses to know if they are affected. This means looking at your turnover before pensions and dividends.<\/p>\n
Some individuals are automatically exempt from MTD for Income Tax and do not need to apply for it.<\/p>\n
These include:<\/p>\n
These exemptions apply on a year-by-year basis and you must review your eligibility regularly.<\/p>\n
If your circumstances do change, MTD may apply to you from that point onward.<\/p>\n
There is also a digital exclusion for MTD, which applies to individuals who cannot reasonably comply with the requirements.<\/p>\n
This could be due to:<\/p>\n
However, these exemptions must be clearly supported with evidence, as HMRC will test this strictly.<\/p>\n
A preference for paper records, not being confident with technology, wanting to avoid additional software costs or having few transactions will not qualify.<\/p>\n
It is also important to know that using an accountant does not make you exempt. If your agent submits information digitally on your behalf using MTD-compliant software, HMRC will expect you to meet the MTD requirements. It is not the responsibility of your accountant to ensure you comply.<\/p>\n
If you believe you or someone you know is exempt from MTD, you must make an application directly to HMRC either by phone or in writing.<\/p>\n
You will need to provide personal details, your current filing method and a clear explanation with evidence of why MTD is not reasonably practical for you.<\/p>\n
HMRC will aim to respond within 28 days, but you are expected to prepare for MTD while you are awaiting this decision.<\/p>\n
If your application is refused, you must then comply with the MTD requirements. You do have the right to appeal, but you are not exempt until HMRC confirms this.<\/p>\n
HMRC exemptions will only apply to a small minority of people and for most landlords, self-employed individuals and sole traders, it is unavoidable.<\/p>\n
You are running out of time and rushed decisions or inaction now could lead to costly mistakes, including fines.<\/p>\n
If you believe you or someone you support may qualify for an exemption, you must seek advice now.<\/p>\n
We can help assess whether an exemption is genuinely correct and guide you through the application process so that it is fully supported with evidence.<\/p>\n
If you find that you are not exempt, our team can help explain the MTD process and your requirements and advise on digital record-keeping and MTD software that works for you.<\/p>\n
We can monitor changes in your income thresholds and exemption status as more people will be affected by MTD in the next few years.<\/p>\n
Whether you are preparing for MTD or need to apply for an exemption now, our team can help you so that your business and finances stay compliant.<\/p>\n
For more information or guidance, contact our team today.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" The first phase for Making Tax Digital (MTD) for Income Tax is nearly upon us, as the new system of digital tax reporting commences from 6 April 2026.<\/p>\n","protected":false},"author":2,"featured_media":6807,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,33,7],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/6804"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=6804"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/6804\/revisions"}],"predecessor-version":[{"id":6805,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/6804\/revisions\/6805"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media\/6807"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=6804"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=6804"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=6804"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}