- Digital record keeping, reporting and paying tax, using MTD compatible software.
- The legislation imposes quarterly digital reporting obligations for income tax for self-employed individuals and landlords where their businesses are potentially within the scope of income tax. For UK residents, the regime therefore applies to UK and foreign businesses alike.
- Temporary exemptions apply to certain groups for the 2026/27 tax year, including those who completed residence pages or trust and estate pages on their 2024/25 tax returns, or who expect to have similar entries on their 2025/26 or 2026/27 tax returns. They will not need to join MTD until April 2027 at the earliest.
- Longer-term exemptions apply to certain other groups, including ministers of religion and individuals who benefit from Blind Persons’ Allowance.
- There is no further detail on when MTD for ITSA will apply to partnerships other than HMRC stating that “We’ll set out the timeline for this at a later date.
- Timing: MTD for ITSA was introduced from April 2026. Self-employed individuals and landlords with receipts over £50,000 on their 2024/25 tax returns were mandated to join first from April 2026. Those with receipts over £30,000 on their 2025/26 tax returns will be mandated from April 2027. Those with receipts over £20,000 on their 2026/27 tax returns will be mandated from April 2028. HMRC will requireto file their tax return through MTD software instead of HMRC’s online filing service.
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