Updated: Jun 24
What is Making Tax Digital?
Making Tax Digital (MTD) is HMRC’s plan to digitize the tax system for VAT, Income Tax Self Assessment and Corporation Tax for businesses and individuals. MTD aims to make tax returns simpler and more efficient for everyone.
What is MTD for ITSA?
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is the next step in the MTD timeline from HMRC. From April 2026 if you have an income of over £50,000 annually, from self employment or property rental, you'll need to:
Use MTD compatible software
Go digital with your finances
Submit your tax returns quarterly
Quarterly ITSA submissions
You'll need to submit quarterly summary data to HMRC, rather than one larger end of year ITSA. You'll need to submit the summaries electronically with the help of compliant software. Submit End of Period Statement direct to HMRC adjusting and confirming your previous summaries as necessary. This will be submitted at the end of the tax year. Submit a final declaration to HMRC confirming other income you have made at the end of the tax year.
Digital software keeps financial admin all in one place, helps automate repetitive tasks, and provides an overview of challenges and opportunities.
It's easier to manage business admin with automated processes, digital records, and an almost instant view of your finances.
Through two factor authentication (2FA), data encryption, and more, you can be assured your information is safe and stored securely.
Work with your accountant or clients with ease, through software that allows you to share information instantly.
When do I need to be compliant with MTD?
Now applies to all VAT-registered businesses.
MTD for ITSA
MTD for Income Tax Self Assessment will apply if you have an annual self-employment or property income of more than £50,000.
MTD for Corporation Tax
Making Tax Digital for Corporation Tax to be introduced at the earliest.
MTD for ITSA
MTD for Income Tax Self Assessment will apply if you have an annual self-employment or property income of more than £30,000.
Here at NPW Bookkeeping Services we use the very latest software that is fully MTD compliant. All our data is encrypted, using 256 bit AES encryption software, so you can be assured your data will be safe and secure.