Making Tax Digital thresholds explained
Making Tax Digital for Income Tax applies from April 2026 if your qualifying income exceeds £50,000, from April 2027 above £30,000, and from April 2028 above £20,000. Qualifying income is your gross self-employment turnover plus gross property income, before any expenses are deducted.
The thresholds and when they apply
HMRC is phasing Making Tax Digital for Income Tax in over three years, starting with the highest earners. Your start date depends on the qualifying income reported on a specific earlier tax return, not on what you earn in the year you join.
| From | Qualifying income above | Based on your return for |
|---|---|---|
| 6 April 2026 | £50,000 | 2024/25 |
| 6 April 2027 | £30,000 | 2025/26 |
| 6 April 2028 | £20,000 | 2026/27 |
The lookback matters. If your 2025/26 return shows more than £30,000 of qualifying income, you are in from April 2027, even if your income has since fallen.
What counts as qualifying income
Qualifying income is the total of your gross self-employment turnover and your gross property income. Gross means before expenses, before mortgage interest and before capital allowances.
This is the single most misunderstood part of the rules. A landlord with £34,000 of rent and a £24,000 mortgage interest bill has £10,000 of taxable profit but £34,000 of qualifying income, and is therefore caught from April 2027.
If you have both a business and rental property, the two are added together. Two streams of £18,000 each put you over the £30,000 line.
What does not count
Employment income taxed through PAYE, dividends, savings interest, pension income, capital gains and income from a partnership share are all excluded from the qualifying income test. They still get reported in your final declaration, but they do not drag you into MTD.
Worked examples
| Situation | Qualifying income | MTD from |
|---|---|---|
| Sole trader, £62,000 turnover | £62,000 | April 2026 |
| Landlord, £36,000 gross rent | £36,000 | April 2027 |
| Consultant £22,000 + rent £14,000 | £36,000 | April 2027 |
| Employed £70,000 + rent £18,000 | £18,000 | April 2028 |
| Sole trader, £26,000 turnover | £26,000 | April 2028 |
| Landlord, £15,000 gross rent | £15,000 | Not currently in scope |
This guide is general information, current at 9 November 2026. Tax rules change and depend on your circumstances. Please take advice before acting on it.