March 2026
Making Tax Digital for Self-Employed (2026): What You Need to Know
From April 2026, self-employed individuals and landlords earning more than £50,000 per year will need to keep digital records and submit regular updates to HMRC.
From April 2026, the UK tax system changes significantly for many self-employed individuals. Under Making Tax Digital for Income Tax, those earning above the threshold must keep digital records and submit regular updates to HMRC — replacing the single annual Self Assessment return.
This change is part of the government’s long-term plan to modernise the tax system. But for many small business owners it means a significant shift in how they report.
What Will Change From April 2026?
Currently, most self-employed individuals submit one Self Assessment tax return per year. Under MTD for Income Tax, that single filing becomes a continuous reporting process.
- Four quarterly updates — reporting income and expenses every three months
- An End of Period Statement — confirming figures for the full year
- A Final Declaration — replacing the current Self Assessment return
In practice, this means reporting your business figures several times per year instead of once annually. The switch requires proper digital bookkeeping tools and a clear system for capturing income and expenses throughout the year.
Who Will Be Affected?
Self-employed individuals and landlords with income above £50,000 per year must comply with MTD for Income Tax.
The threshold expands to include those earning more than £30,000 from self-employment or property.
If your income is close to either threshold, now is the right time to assess your position and make sure your systems are ready.
What Will Self-Employed Individuals Need to Do?
To comply with Making Tax Digital, you will need to:
- keep digital accounting records throughout the year
- use HMRC-compatible MTD software
- submit quarterly updates within one month of each quarter ending
- submit an End of Period Statement and Final Declaration annually
Many business owners are now reviewing their accounting systems and processes to ensure they are ready well before the April 2026 deadline.
Reviewing Your Business Structure
“Is self-employment still the best structure for my business?”
For some professionals, the upcoming changes have triggered a broader question — one that many have postponed for years. If you earn above the threshold, you are already required to keep detailed digital records. Some business owners are now asking whether those records would look the same inside a Limited Company, with the added advantages that structure brings.
Some business owners who have been self-employed for many years are reviewing whether operating through a Limited Company may be more practical for their situation. There is no single answer that fits everyone, but this transition period has encouraged many entrepreneurs to consider their options seriously.
Registering a Limited Company
If you are considering moving your activity into a company structure, the process of registering a UK company is relatively straightforward. Once the required details are provided, a company can typically be registered with Companies House within 24–48 hours.