You are likely to need Making Tax Digital for Income Tax if you are a sole trader or landlord registered for Self Assessment and your gross qualifying income from self-employment and property is above the threshold for the relevant test year. Use the four-question checker below for an indication, then confirm the result using HMRC's official guidance.
MTD Income Tax threshold checker
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How the threshold test works
The key point is that HMRC looks at qualifying income shown on an earlier Self Assessment return. The 2024/25 return determines whether you should have entered MTD from 6 April 2026, the 2025/26 return is used for the April 2027 £30,000 phase, and the 2026/27 return is used for the April 2028 £20,000 phase.
| Return tested | Threshold | Start date |
|---|---|---|
| 2024/25 | More than £50,000 | 6 April 2026 |
| 2025/26 | More than £30,000 | 6 April 2027 |
| 2026/27 | More than £20,000 | 6 April 2028 |
What counts as qualifying income?
Qualifying income is the total income from self-employment and property before expenses. If you have more than one trade or rental source, HMRC can aggregate them. Employment wages, dividends, pensions and an individual's share of partnership profit are not part of the qualifying-income calculation.
Worked example: sole trader
A sole trader reported gross sales of £54,000 on the 2024/25 return and £18,000 of allowable business expenses. The MTD test uses the £54,000 turnover, not the £36,000 profit. Because the qualifying income was more than £50,000, they should have started using MTD for Income Tax from 6 April 2026 unless an exemption applies.
Worked example: landlord with jointly owned property
A landlord jointly owns a property that produces £50,000 gross rent and is entitled to an equal 50% share. Assuming there is no other qualifying self-employment or property income, their qualifying property income is generally £25,000. That is below the £30,000 and £50,000 phases but could become relevant for the £20,000 threshold from April 2028.
Worked example: business plus property
A person has £29,000 of self-employment turnover and £22,000 of gross property income. Their qualifying income is £51,000 because the two sources are added together. If those figures were on the 2024/25 return, they should have entered MTD from April 2026. This aggregation rule is easy to miss when each source is considered separately.
What if HMRC has not written to you?
HMRC reviews Self Assessment returns and writes to people it identifies as being above the relevant threshold, but HMRC also states that it remains your responsibility to check. If your figures put you above the threshold, do not rely on the absence of a letter. Confirm your position, arrange compatible software and complete the sign-up process.
What if your income falls after you enter MTD?
You do not usually leave MTD immediately just because one later year falls below the threshold. Under HMRC's current rules, you can generally opt out after qualifying income has stayed at or below the relevant threshold for three consecutive tax years, subject to the detailed conditions and any other change in circumstances.
A simple four-step MTD decision tree
First, check whether you are a sole trader or landlord with Self Assessment income. Second, identify the tax return HMRC uses for the phase you are checking. Third, add together the gross qualifying income from every relevant self-employment and property source. Fourth, compare that total with the threshold and then consider whether HMRC has confirmed an exemption or whether another special rule affects your case.
- Income type: if you have no self-employment or property income, the current mandatory MTD Income Tax rules are not normally triggered by other income alone.
- Test year: use the correct earlier return, not an estimate of this year's profit.
- Gross total: combine qualifying sources before expenses rather than comparing each source separately.
- Exceptions: check exemptions, amended returns, ceased income sources and other HMRC rules before treating the result as final.
What can change a simple checker result?
A threshold checker cannot cover every tax situation. An amended Self Assessment return can change qualifying income, short accounting periods may need annualising, an income source may have ceased, jointly owned property needs your correct share, and some specialist income or exemptions have their own rules. HMRC also distinguishes between permanent and temporary exemptions. If any of those points apply, use the official guidance or ask an adviser to review the position rather than relying only on a calculator result.
Why the checker uses gross income
The MTD test deliberately uses qualifying income before expenses rather than taxable profit. That keeps the threshold calculation separate from later deductions and tax adjustments. When entering a figure above, use the gross amount shown for the relevant self-employment and property sources, not the amount left after business costs, mortgage interest, repairs or other expenses.
What should you do next?
If the checker indicates that MTD applies, your practical next steps are to confirm the result on GOV.UK, make sure you have compatible software, get digital bookkeeping up to date and decide whether you or your accountant will handle the quarterly cycle. If the result is close or your circumstances are unusual, get advice before assuming you are outside the rules.