HMRC to Start Automatically Signing Up Taxpayers for Making Tax Digital

HMRC is stepping up the rollout of Making Tax Digital for Income Tax (MTD), with automatic sign-ups beginning from September 2026.

The rules already apply to sole traders and landlords whose qualifying self-employment and property income exceeded £50,000 in the 2024/25 tax year. Importantly, the £50,000 test is based on income before expenses, rather than taxable profit.

More than 570,000 people had signed up by 12 August, and over 436,000 had submitted their first quarterly update. HMRC will now begin signing up people who should already be within MTD but have not registered themselves. The process will take place in stages over the coming months.

Being signed up by HMRC does not remove the taxpayer’s responsibilities. Those affected will still need to obtain compatible software, connect it to HMRC, create digital records going back to the start of the tax year and submit any overdue quarterly updates.

The first quarterly deadline was 7 August 2026, while the next is 7 November 2026. Quarterly updates are summaries of income and expenses rather than separate tax returns, and the usual Self Assessment obligations remain.

HMRC will not issue penalty points for late quarterly updates during 2026/27, although penalties can still apply for late tax returns or tax payments.

The scope of MTD will widen further: those with qualifying income above £30,000 join from April 2027, followed by those above £20,000 from April 2028.

For affected landlords and sole traders, the message is increasingly clear: waiting for HMRC to sign you up does not avoid MTD — it simply leaves less time to get records and software organised.