Do I Need to Join Making Tax Digital (MTD)?

Quick Answer

You will usually need to join MTD if:

  • You are a sole trader or landlord
  • Your business and/or rental income is above HMRC’s threshold
  • You have already submitted at least one Self Assessment tax return
  • You are not exempt

If you’re unsure — don’t worry. That’s completely normal. Here’s a simple way to work it out 👇

MTD Flowchart (Simple Check)

Step 1: Do you run a business or receive rental income?

  • No → You do not need to join MTD
  • Yes → Go to Step 2

Step 2: Is your income from these over the threshold?

Add together:

  • Your self-employment income, and
  • Your property (rental) income

👉 This is based on income (turnover/rent), not profit

Then check:

  • Over £50,000 → MTD starts from April 2026
  • Over £30,000 → MTD starts from April 2027
  • Over £20,000 → MTD starts from April 2028
  • £20,000 or less → You are not currently required to join

Step 3: Have you submitted your first tax return yet?

  • No → You do not need to join MTD yet
  • Yes → Go to Step 4

Step 4: Are you exempt?

You may not need to join if, for example:

  • You cannot use digital systems
  • You have specific circumstances accepted by HMRC

If not → You will need to join MTD

What Income Counts (and What Doesn’t)

✅ Included in the threshold:

  • Self-employment income
  • Rental/property income

❌ Not included:

  • Salary from a job (PAYE)
  • Dividends
  • Savings interest
  • Pension income

👉 So even if your total income is high, MTD may not apply if your business/rental income is below the threshold.

I’ve Just Started a Business — Do I Need MTD Straight Away?

No — not immediately.

If you’ve just started:

  • You will still complete a normal Self Assessment tax return first
  • HMRC will then assess your income
  • If you meet the threshold, MTD will apply from a later date

👉 So you won’t be forced into MTD on day one.

What Happens If My Income Changes?

  • If your income goes above the threshold, HMRC will bring you into MTD
  • If your income later drops, you usually need to stay in MTD until it’s below the threshold for a number of years

What Does Joining MTD Actually Mean?

If MTD applies to you, you’ll need to:

  • Keep digital records
  • Send quarterly updates to HMRC
  • Submit a final year-end declaration

👉 Instead of one big tax return, it’s spread across the year.

What Should I Do Now?

If you think MTD might apply to you — or will soon — the best thing you can do is get prepared early.

At DMO Accountants, we’ll:

  • Confirm whether MTD applies to you
  • Tell you exactly when it starts
  • Set you up with a simple, stress-free system
  • Handle the submissions for you

Still not sure?

That’s what we’re here for.

👉 Get in touch and we’ll give you a clear answer — no jargon, no stress.