Making Tax Digital FAQs: 10 Common Questions Answered (2026)

Culverhouse & Co
1 day ago
2 min read

Making Tax Digital (MTD) is changing the way many self-employed individuals and landlords report their income to HMRC.

If you're wondering whether the new rules affect you, you're not alone. Here are answers to some of the Making Tax Digital FAQs we hear most often.

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1. Who Needs to Use Making Tax Digital?

Making Tax Digital for Income Tax applies to self-employed individuals and landlords whose qualifying income exceeds HMRC's thresholds.

The rollout is taking place in stages:

April 2026: Income of £50,000 or more

Now this has passed, click here for more updates.

April 2027: Income of £30,000 or more
April 2028: Income of £20,000 or more

If your income falls within these limits, you'll need to follow the new digital reporting requirements.

2. Do I Need to Register?

Yes.

HMRC won't automatically enrol you into Making Tax Digital. If you're required to join, HMRC will contact you and you'll need to register before you begin submitting your records digitally.

3. What Does Making Tax Digital Require?

Under the new rules you'll need to:

Keep digital financial records
Submit quarterly updates to HMRC
Complete a final end-of-year declaration
Use HMRC-compatible software throughout the process

4. Can I Still Use a Spreadsheet?

Yes, in many cases.

You can continue using spreadsheets, but you'll normally need bridging software to submit your information to HMRC digitally.

Many businesses choose dedicated accounting software instead, as it simplifies the reporting process.

5. Which Software Can I Use?

There are several HMRC-recognised software providers available, including cloud accounting platforms designed specifically for Making Tax Digital.

The right solution depends on how you currently keep your records and the complexity of your finances.

6. When Are Quarterly Updates Due?

Quarterly updates are generally due on the 7th day of the month following each reporting period, with a final declaration submitted after the end of the tax year.

Keeping your records updated throughout the year makes meeting these deadlines much easier.

7. Are There Any Exemptions?

Some individuals may qualify for an exemption if using digital technology isn't reasonably practical due to circumstances such as disability, age, location or certain religious beliefs.

Applications must be made directly to HMRC.

8. What Records Do I Need to Keep?

You'll need to maintain digital records of your income and allowable expenses throughout the year.

Accurate record keeping not only helps you comply with HMRC's rules but also provides a clearer picture of your financial position.

9. What Happens If I Miss a Deadline?

Making Tax Digital uses a points-based penalty system for late submissions.

Missing deadlines repeatedly can result in financial penalties, so it's important to stay organised and submit your updates on time.

10. I'm Still Confused - Where Can I Get Help?

Making Tax Digital is a significant change, and many people are unsure where to begin.

At Culverhouse & Co, we help self-employed individuals and landlords understand their obligations, choose suitable software and stay compliant with HMRC's requirements.

If you'd like straightforward advice on Making Tax Digital, get in touch with our team - we're here to help.

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