Only Half of Taxpayers Filed Their First MTD Return on Time. Are You Ready for the Changes Ahead?

The first Making Tax Digital (MTD) for Income Tax deadline has shown how challenging the new system can be for some business owners and landlords.

HMRC’s latest figures show that around 864,000 sole traders and landlords with income over £50,000 were required to join MTD from April 2026. Around 570,000 signed up before the deadline, but only 436,000 submitted their first quarterly update by 7 August.

As a result, HMRC has announced that from September it will begin automatically enrolling eligible taxpayers who have not yet signed up themselves. This means that if you fall within the rules and haven’t acted, HMRC may do it for you.

The figures show that many people are finding the move to digital tax reporting more difficult than expected. Some have struggled to choose the right software, while others have found it challenging to keep digital records or understand exactly what information needs to be submitted each quarter.

Although the current rules only affect sole traders and landlords with income over £50,000, this is just the start of HMRC’s plans.

Since April 2026, anyone with qualifying income above £50,000 has been required to follow the MTD rules. From 6 April 2027, the threshold will fall to £30,000, meaning thousands more taxpayers will be brought into the system. HMRC has also confirmed that it plans to extend MTD to those with income of £20,000 or more in the future.

Sean Farnell, Partner at Burgis & Bullock, commented: “Making Tax Digital isn’t simply about submitting information online. It requires people to keep digital records and use compatible software throughout the year. With the income threshold reducing to £30,000 next year and eventually £20,000, it is important to understand what the changes mean and make sure you’re prepared.”

To help local businesses and landlords understand the new rules, Burgis & Bullock is hosting another free Making Tax Digital briefing at their Leamington Spa office on Thursday 17 September from 12pm to 1pm.

The session will explain what MTD is, who will be affected, what records you need to keep, and how to avoid common mistakes. Whether you’re already within the £50,000 threshold or expect to be affected when the limit falls to £30,000, the briefing will provide practical guidance to help you prepare with confidence. Book your tickets today at https://www.burgisbullock.com/events/

For further information, please contact Burgis & Bullock  https://www.burgisbullock.com/contact-us/