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Making Tax Digital
Records a quarterly update can be taken from.
Making Tax Digital requires digital records and, for Income Tax, quarterly updates sent from compatible software. Gundastream keeps those records reconciled. We do not decide your tax, and we do not send the update to HMRC.
Read this before the table
This page is a plain-language summary of public GOV.UK guidance as we read it on 23 October 2026. It is not advice about whether you must join, whether you are exempt, or how your own income is measured. Thresholds, exemptions and dates can change. Check Check if you are eligible for Making Tax Digital for Income Tax and Use Making Tax Digital for Income Tax, or ask your accountant.
VAT has been digital for some time
VAT-registered businesses already have to keep digital records and submit VAT returns through Making Tax Digital compatible software, subject to the exemptions HMRC publishes. Gundastream’s part of that is the ledger: output tax and input tax coded on the transactions, and a VAT control account that reconciles to the period.
The return itself is submitted by you or by your accountant from that file. If a figure on the return cannot be traced to the control account, we say so in the monthly note. We do not “adjust the return” .
Income Tax is now in force, in stages
Making Tax Digital for Income Tax applies to sole traders and landlords with qualifying income above a threshold. Qualifying income is turnover from self-employment and property, before expenses, taken from a previous tax return. Partnerships are expected to come later; the government has said the timetable for them will be set separately.
People already inside the rules need digital records of their self-employment and property income and expenses, and they need to send quarterly updates. A final declaration still sits with the tax return cycle. The software that sends the update has to be compatible. A spreadsheet on its own, with no digital link, is not the end of the requirement.
When Income Tax mandation starts
The start date depends on qualifying income in a particular tax return, not on a guess about the current year. The table follows GOV.UK’s published stages. If your accounting date is 31 March, the operational start can be 1 April rather than 6 April. Confirm which update periods you are on before you plan the first quarter.
| Self Assessment return | Qualifying income | Start using MTD for Income Tax |
|---|---|---|
| 2024 to 2025 | More than £50,000 | 6 April 2026 |
| 2025 to 2026 | More than £30,000 | 6 April 2027 |
| 2026 to 2027 | More than £20,000 | 6 April 2028 |
Source for the stages: GOV.UK guidance updated in October 2026, including the published plan to lower the threshold to £20,000 from April 2028. Exemptions exist, including some temporary exemptions. Do not treat absence from this table as confirmation that you are outside the rules.
A first-year timetable, standard periods
GOV.UK’s timetable for someone who starts on 6 April 2026 with standard update periods is the pattern below. Later cohorts follow the same shape in their own first year. Calendar update periods use different record start dates. This is an orientation, not your personal filing calendar.
| What | By |
|---|---|
| Digital records in compatible software | From 6 April 2026 for standard update periods |
| First quarterly update | 7 August 2026 |
| Second quarterly update | 7 November 2026 |
| Third quarterly update | 7 February 2027 |
| Fourth quarterly update | 7 May 2027 |
| Tax return from compatible software, with any adjustments your adviser makes | The normal Self Assessment deadline, 31 January following the tax year |
What Gundastream actually does for MTD
- Keep income and expenses in the ledger as digital records, with the date, the amount, and the category, and with the source attached where you have provided it.
- Reconcile the bank and the relevant clearing accounts so the totals are the totals of real transactions, not a typed estimate.
- Separate personal and business movements where they share an account, and put the personal element on the owner or director account.
- Have the quarter’s figures ready, with the exception list, in time for you or your accountant to send the update.
- For landlords, record rents, agent fees and the costs on the agent statement, property by property when you have more than one.
What we do not do
- We do not tell you whether your qualifying income is over a threshold.
- We do not apply for an exemption on your behalf.
- We do not submit quarterly updates, the final declaration, or VAT returns to HMRC.
- We do not claim allowances, reliefs or losses. Those belong in the return your adviser completes.
- We do not sign up your Government Gateway account, and we do not ask for its password.
Questions
I am a limited company. Does this Income Tax regime apply to me?
Making Tax Digital for Income Tax, as described above, is about sole traders and landlords in Self Assessment. A limited company has corporation tax, and if it is VAT registered it already has Making Tax Digital for VAT. A director who also has personal self-employment or rental income can be inside the Income Tax rules for that other income. Ask your accountant which regimes apply to which entity. We keep the company’s ledger either way.
Can you file the quarterly update if I authorise you?
No. Submission to HMRC is outside this service, including where you would be willing to authorise it. The file is prepared so that you or your accountant can submit from compatible software. This keeps the responsibility for the declaration with the person who is making it.
What if I am already late for a 2026 update?
Tell us the periods and send the statements. We can reconstruct the digital records where the documents exist. We cannot undo a penalty, and we will not guess at transactions to make a quarter look complete. Your accountant should talk to you about the filing position. HMRC publishes the penalty points for late updates; we do not advise on them.
Do you provide the compatible software?
You subscribe to the ledger. We work inside it. If the package you have cannot keep digital records or cannot be used to send updates, we will say so, and you and your accountant choose a replacement. We do not sell software and we are not an HMRC-listed product.
Bring the question to your accountant, and the records to us.
If you already know you are inside the rules, the useful next step is a reconciled quarter, not another summary of the legislation.