Digital records and quarterly updates are changing how eligible sole traders and landlords report their income to HMRC.

Making Tax Digital for Income Tax became mandatory in April 2026 for sole traders and landlords with qualifying income above £50,000, subject to exemptions. Those affected must keep digital records and use compatible software to send quarterly summaries of income and expenses to HMRC.

By August 2026, more than 436,000 customers had submitted their first quarterly update. These updates provide a summary of business activity; they do not replace the annual Self Assessment tax return.

The next phase will bring more taxpayers into the system. From April 2027, the requirements will extend to those with qualifying income above £30,000.

For business owners and landlords, keeping records organised and choosing suitable software are practical steps towards managing the new reporting process.

Source: HM Revenue & Customs · 12 August 2026

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