MTD for Income Tax Checker
Making Tax Digital for Income Tax Self Assessment (MTD ITSA) is a major change to the UK tax system. The AbraTax MTD checker applies HMRC's published gross qualifying-income thresholds to show the potential start date that corresponds to the information you enter.
Who Needs to Use This Checker
This checker is relevant for:
- Sole traders with income from self-employment
- Landlords with qualifying property income (UK residents generally include UK and foreign property income; non-UK residents generally include UK property income only)
- Anyone with both self-employment and property income
- Accountants and bookkeepers checking which of their clients may fall within scope
If your income comes entirely from employment through PAYE, a pension, or investments, Making Tax Digital for Income Tax does not currently apply to you.
The MTD for Income Tax Rollout Timetable
HMRC is phasing in MTD for Income Tax based on qualifying gross income levels:
- From April 2026: mandated for those with over £50,000 qualifying gross income
- From April 2027: mandated for those with over £30,000 qualifying gross income
- From April 2028: mandated for those with over £20,000 qualifying gross income
What Counts as Qualifying Income?
Qualifying income is the combined gross income from:
- Self-employment, meaning sole trader income before expenses
- Qualifying property income before expenses: UK residents generally include UK and foreign property income, while non-UK residents generally include UK property income only
Income from employment, pensions, dividends, savings interest, or capital gains does not count towards the qualifying income threshold. HMRC uses the gross figure before any expenses or deductions.
How to Use the MTD for Income Tax Checker
- Select the reference tax year from the relevant Self Assessment return.
- Enter your gross income from self-employment before any business expenses.
- Enter your gross qualifying property income before any property expenses.
- Confirm whether you are registered for Self Assessment.
- The checker will combine the qualifying income and show the potential MTD start date indicated by the threshold test.
What Happens Once You Are in Scope
Once you join MTD for Income Tax, you will need to:
- Keep digital records of your income and expenses using compatible software such as AbraTax
- Submit quarterly updates to HMRC through your software
- Submit your tax return through compatible software after the end of the tax year, including required information about other income, allowances, and reliefs
HMRC will use the quarterly figures to give you a running estimate of your tax liability throughout the year, helping you plan your cash flow.
Frequently Asked Questions
My total income is above the threshold, but most of it is from employment. Am I in scope?
Only your gross income from self-employment and qualifying property income counts towards the qualifying income threshold. Employment income taxed through PAYE does not count, regardless of how much you earn from your employer.
What if my income varies year to year and sometimes falls below the threshold?
HMRC determines your MTD for Income Tax obligation based on the income reported on the relevant tax return. If your income later drops below the relevant threshold, HMRC's rules determine whether and when you can leave MTD for Income Tax.
Is there a penalty for not joining on time?
HMRC says no late-submission penalty points will be issued for late quarterly updates in 2026/27, the first mandatory year, provided all four are submitted by the tax-return deadline. Later years use the points-based system, and separate late-payment penalties can apply when tax is paid late.
Do I need to use specific software?
Yes. MTD for Income Tax requires HMRC-compatible software that can submit quarterly updates digitally. AbraTax is HMRC-recognised MTD bridging software built for sole traders and landlords.
Who is exempt from MTD for Income Tax?
HMRC has set out limited exemption categories, including digital exclusion, certain religious beliefs that prevent the use of computers, and cases where HMRC decides it is not reasonably practicable to comply. Exemptions must be applied for and are not automatic.
Limits of This Checker
Compatible software is required when MTD for Income Tax applies. This checker does not assess software readiness.
Employment income does not count towards qualifying income, and self-employment and qualifying property income are measured before expenses. This checker applies only the income threshold; exemptions and other HMRC conditions can still affect the position.
The threshold test uses gross qualifying income before expenses. A result close to a threshold does not determine the final figure HMRC will use or whether an exemption applies.
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