What is changing?

Making Tax Digital for Income Tax is an important change that some people may need to prepare for now.

From 6 April 2026, it becomes mandatory for sole traders and landlords with qualifying income over £50,000. HMRC says this will then extend to those with qualifying income over £30,000 from 6 April 2027 and over £20,000 from 6 April 2028¹.

What does this mean in practice?

In simple terms, this means some people who currently complete a Self Assessment tax return in the usual way will need to keep digital records, use compatible software and send quarterly updates to HMRC.

Who should be aware of this?

This will not affect everyone straight away, and it is not something your mortgage adviser can advise on from a tax-planning perspective. But it is worth being aware of now, particularly if you are self-employed, receive income from property or expect to fall within the relevant income thresholds in the next few years.

Could it affect a mortgage application?

From a mortgage point of view, Making Tax Digital does not change lenders’ underwriting rules by itself. However, for self-employed applicants and landlords, clearer and more up-to-date records may make it easier to organise income information and supporting documents when preparing for a mortgage application.

What should you do next?

The key message is not to worry, but to be prepared. If you think Making Tax Digital may affect you, now is a good time to check the latest HMRC guidance and speak to your accountant or tax adviser about what it means for your circumstances. If you are also planning a mortgage application, staying organised with your records can help support a smoother process.

If Making Tax Digital may apply to you, it is important to be aware of the guidance provided by accountants or tax advisers. Similarly, for those planning a mortgage application, understanding the requirements for paperwork and documentation in advance can be helpful.

References:

1. GOV.UK (2026). Get ready for Making Tax Digital for Income Tax – when to start. [online] Available at: https://makingtaxdigital.campaign.gov.uk/get-ready-for-making-tax-digital/    [Accessed 24 Mar. 2026].

Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.

The FCA does not regulate some forms of Buy to Lets.

All the information in this article is correct as of the publish date 26^th March 2026. The opinions expressed in this publication are those of the authors. The information provided in this article, including text, graphics and images does not, and is not intended to, substitute advice; instead, all information, content, and materials available in this article are for general informational purposes only. Information in this article may not constitute the most up-to-date legal or other information.

Please be aware that by clicking on to any of the above links you are leaving our website. Please note that neither we nor HL Partnership Limited are responsible for the accuracy of the information contained within the linked site(s) accessible from this page.