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MTD for Income Tax | Landlords & Sole Traders | Harkia Chartered Accountants
Harkia Chartered Accountants
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MTD for Income Tax
for Landlords & Sole Traders

Check whether you are likely to be affected from 6 April 2026, 6 April 2027 or 6 April 2028 based on your gross qualifying income from property and/or self-employment.

The key test is not profit. It is your gross qualifying income before expenses. If you are a landlord, a sole trader, or both, start with the checker below.

Gross income test Quarterly reporting guidance Software options explained Quote after checking
CHECK IF MTD APPLIES TO YOU → SEE HOW WE HELP
Best first step
Use the checker before requesting a quote
Designed for
Landlords, sole traders, or both
What changes
Digital records, quarterly updates, year-end filing

The key dates most people are searching for

MTD for Income Tax is being phased in by qualifying income. If your income is over the relevant threshold, you should get ready before the start of the tax year when the rules begin to apply to you.

First phase
6 April 2026

Likely applies if your qualifying income for 2024/25 was over £50,000.

Second phase
6 April 2027

Likely applies if your qualifying income for 2025/26 was over £30,000.

Third phase
6 April 2028

Likely applies if your qualifying income for 2026/27 was over £20,000.

HMRC generally checks the relevant tax return and then writes to confirm that MTD applies. Even if you do not receive a letter, you should still check your position and prepare in time.

Embedded MTD checker

Check if MTD is likely to apply to you

Complete the checker below to see your likely start date, urgency level and next practical step.

What MTD for Income Tax actually means

MTD for Income Tax is about digital record-keeping, compatible software and quarterly reporting for relevant self-employment and property income.

It is not simply a new tax payment date, and the key threshold test is based on gross qualifying income before expenses.

If you are still unsure, the quickest next step is to use the MTD checker above.

Professional chartered accountant meeting with client about MTD for Income Tax

Who this applies to

You may need to use MTD for Income Tax if you:

  • are in Self Assessment
  • have self-employment income, property income, or both
  • have gross qualifying income above the relevant threshold for the relevant year

Important:

The threshold is not per property and not per business. It is based on your total qualifying income from self-employment and property.

Commonly included

Self-employment income and property income, using gross figures before expenses.

Commonly not included

Employment income, dividends, pensions and capital gains do not count towards the threshold test.

CHECK IF MTD APPLIES → GET A FIXED-FEE QUOTE

What counts towards the threshold?

This is where many landlords and sole traders get confused. The threshold test is about qualifying income, not profit and not total income from every source in your life.

Usually counts

  • Gross self-employment income before expenses
  • Gross UK property income before expenses
  • Relevant foreign property income where it falls within the rules
  • Income from ceased self-employment or property sources can still count for threshold purposes in the relevant year

Usually does not count

  • Employment income under PAYE
  • Dividends, including dividends from your own company
  • State pension and private pensions
  • Capital gains
  • Your share of profit from a partnership as an individual partner, although separate partnership-related rules can still matter in specific cases

Most people we speak to are asking...

“Is the £50,000 threshold per property or per business?”

No. It is based on your total qualifying income from property and self-employment.

“Do I look at profit or gross income?”

Gross income. The threshold test is before expenses and before tax.

“Do I need Xero or QuickBooks?”

You need compatible software, but that does not automatically mean one specific platform is mandatory.

“Will I start paying tax quarterly?”

Quarterly updates are reporting obligations. They are not simply the same thing as quarterly tax payments.

What actually changes?

Keep digital records

You need digital records for relevant self-employment and property income and expenses.

Send quarterly updates

Quarterly updates are sent for each relevant self-employment and property income source.

Use compatible software

HMRC does not provide the software. You need software that works with MTD for Income Tax.

Complete the year-end process properly

Year-end obligations still matter. The quarterly process is not the whole job, so the final compliance stage still needs to be handled carefully.

Digital record keeping and quarterly reporting for MTD for Income Tax

Why early preparation matters

Leaving MTD until the last minute usually creates unnecessary pressure around records, software selection, onboarding and quarterly workflow.

For people mandated from 6 April 2026, HMRC says it will not charge penalty points for late quarterly updates during the first tax year, but other penalties can still apply, including for late returns or late payment of tax.

What to do now

  • Confirm whether MTD applies to you
  • Review how you currently keep records
  • Choose a compliant workflow and software route
  • Decide whether you want DIY software only, compliance support, or full quarterly management

Why people are concerned about MTD

They currently use spreadsheets or manual records

They want to avoid unnecessary software costs

They want to stay compliant without guesswork

How we help you prepare properly

The best conversion point is usually after the visitor understands whether MTD applies. That is why our page is designed to move visitors from clarity, to checker, to quote.

1

Applicability Review

We help confirm whether MTD is likely to apply, when it is likely to start, and which income sources matter.

2

Digital Record Strategy

We help you move to a compliant digital process without pushing unnecessary software subscriptions where a more suitable route exists.

3

Quarterly Submission Support

We can manage the quarterly side for you, or support a lighter-touch setup depending on the complexity of your records.

4

Year-End Compliance & Advice

We help with the year-end process, accuracy, reliefs, expenses and practical tax support, not just the quarterly mechanics.

Typical cases we help with

Landlords

Single-property landlords, portfolio landlords, and jointly owned property cases where threshold confusion is common.

Sole traders

Tradespeople, consultants, freelancers and business owners who need a practical path into compliant digital records.

Mixed-income cases

People who have both rental income and self-employment income and need clarity on how the combined threshold works.

Why work with Harkia?

ICAEW regulated firm

London-based specialist

Landlords + sole traders

Clear fixed fees

No unnecessary software upsell

Compliance + advisory support

The best route is simple

1

Use the free checker

2

See your likely MTD position

3

Request a fixed-fee quote if you want support

Primary CTA

For maximum conversion, send visitors to the checker first, then to pricing.

USE THE CHECKER → GET A QUOTE →

Frequently asked questions

Is the £50,000 threshold per property or per business?

No. The test is based on your total qualifying income from self-employment and property, not on each property separately and not on each business separately.

Do I look at profit or gross income?

The threshold test looks at gross qualifying income before deducting expenses or tax. Profit is not the threshold test.

Does salary, dividend income or pension income count towards the MTD threshold?

Generally, no. Employment income, dividends, state pension and private pensions do not count towards the qualifying income threshold for MTD for Income Tax.

If I have both rental income and sole trader income, do I combine them?

Yes. The qualifying income test looks across relevant self-employment and property income sources together.

Do I need software for MTD for Income Tax?

Yes. HMRC requires compatible software for MTD for Income Tax. That does not automatically mean one particular brand is mandatory, but a compliant software route is required.

Does MTD mean I will pay tax quarterly?

No. MTD introduces quarterly reporting obligations. It does not simply replace the current tax payment timetable with quarterly tax bills for everyone.

What if my income later drops below the threshold?

Once you are in MTD, HMRC says that if your qualifying income stays below the relevant threshold for 3 tax years in a row, you may be able to opt out.

What if I have a partnership share as an individual partner?

Your share of profit from a partnership as an individual partner is not itself part of the digital record-keeping requirement in the same way as sole trader or property income. However, if you also have sole trader or property income, those other sources may still bring you into MTD.

What is the best way to get started?

Start with the checker. Once you know whether MTD is likely to apply, you can move to a fixed-fee quote and decide whether you want setup support, quarterly support, or a fuller service.

Ready to check your MTD position?

Start with the checker. If you want support afterwards, you can then move straight to a fixed-fee quote.

USE THE FREE MTD CHECKER → GET YOUR QUOTE IN 10 SECONDS →

Prefer to speak to someone? Call 0208 558 6999 or email info@harkia.co.uk.

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