E-BOOK
Making Tax Digital for Income Tax
Nine chapters on four updates a year instead of one return: who is in, from when, and what needs to be working before the first deadline. The first phase started on 6 April 2026, so for anyone over £50,000 of gross income this is already in force rather than coming.
- Nine chapters, six tables, both sets of quarter dates
- The gross income test, and why profit never enters it
- A chapter on what this does not change, which is most of it
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Who this e-book is for
Sole traders and landlords who need to know whether Making Tax Digital applies to them, when it starts, and what to have working first. Written for people who file their own return and would rather not discover the requirements in August.
You checked your profit and decided you were out of scope
Profit is not the test and never has been. Qualifying income is gross income from self employment and property added together, before any allowances or expenses. Chapter two puts two freelancers side by side who invoice the same £64,000 and make £55,000 and £12,000, and shows why both are in from April 2026.
You think four filings means four tax bills
It does not, and this is the most common worry about the whole regime. A quarterly update is a running total of income and expenses, nothing is claimed or adjusted until the final declaration, and no payment falls due with it. The money still moves on 31 January and 31 July, exactly as before.
Your bookkeeping happens in a burst before each deadline
That is the habit the rules are built to end. Records have to be created digitally as transactions happen, categorised as you go, with digital links carrying figures between systems rather than someone retyping them. A business that categorises weekly barely notices the change.
FACTS
The three phases, and how they are measured
Over £50,000 of qualifying income from 6 April 2026, over £30,000 from 6 April 2027, over £20,000 from 6 April 2028. Each phase is set by the tax year two years before it starts, so by the time it applies it was decided on figures you filed long ago. The thresholds are over, not at: exactly £50,000 misses the first phase and clears the second.
9 chapters
Six tables
4 deadlines
7 Aug, 7 Nov, 7 Feb, 7 May
FACTS
Standard or calendar, and when you have to choose
Standard periods run to the 5th of the month, calendar periods to the month end, and the deadlines are identical either way. Calendar periods usually suit anyone whose bookkeeping already reconciles to month ends. You elect for them in your software, and the election has to be made before the first update of the tax year. After that it is fixed for the year.