Sole traders and landlords will need to use Making Tax Digital for Income Tax, unless they are exempt, if the following apply. They:
are registered for Self Assessment
get income from self-employment or property, or both
have qualifying income of more than £20,000
Qualifying income is the total gross income (before deducting expenses or taxes) from self-employment and property in a tax year.
Other income sources such as from employment (PAYE), partnership income or dividends (including those from your own company) are not included in qualifying income.
When you will need to use Making Tax Digital for Income Tax
When you need to start using Making Tax Digital for Income Tax depends on your qualifying income for a tax year. If your qualifying income is over:
£50,000 for the 2024 to 2025 tax year, you will need to use it from 6 April 2026
£30,000 for the 2025 to 2026 tax year, you will need to use it from 6 April 2027
£20,000 for the 2026 to 2027 tax year, you will need to use it from 6 April 2028
Use the HMRC tool to find out if and when you need to sign up.