HMRC Making Tax Digital letter: what it means and what to do (2026)

HMRC is writing to hundreds of thousands of sole traders and landlords about Making Tax Digital for Income Tax (MTD ITSA) — the biggest change to how the self-employed report tax in a generation. If a letter has just landed on your doormat, this guide explains, in plain English, why you got it, how to tell it's genuine, and exactly what you need to do — and by when.

Why HMRC has written to you

HMRC is running a phased awareness campaign and is contacting the people it expects to be in scope first. Its own eligibility guidance is explicit: “HMRC will write to you, confirming that you need to start using Making Tax Digital for Income Tax.” The trigger is your qualifying income — your gross self-employment turnover plus property rents (before expenses) — on your most recent Self Assessment return.

The rollout happens in three waves, each lowering the threshold:

If your letter is about the first wave, HMRC looked at your 2024/25 return. Two smaller businesses count together: a £28,000 trade plus £24,000 of rent is £52,000 of qualifying income, so you'd be in from April 2026 even though neither is large on its own.

Is the letter genuine, or a scam?

Genuine HMRC MTD letters do exist — but a wave of official letters is exactly when scammers send convincing fakes. Use these checks before you act on anything:

• A genuine MTD letter only tells you to get ready — to check if you're affected and sign up on GOV.UK. It does not ask you to pay anything now or hand over bank or card details.
• Never follow a link or QR code from the letter to “verify” or pay. Go to GOV.UK yourself and search “Making Tax Digital for Income Tax”.
• Cross-check it against GOV.UK's “check if a letter you've received from HMRC is genuine” page, which lists real HMRC letters.
• When in doubt, contact HMRC directly using the phone number on GOV.UK — not one printed in the letter — and report suspected scams to HMRC.

What the letter is actually asking

Once you've confirmed it's genuine, the letter is a prompt to do three things before your start date:

1. Confirm you're in scope — check your gross self-employment + property income against the threshold for your wave.
2. Get MTD-ready software — the GOV.UK Self Assessment online return closes for in-scope taxpayers, so you'll file through HMRC-recognised software instead.
3. Sign up for Making Tax Digital for Income Tax on GOV.UK using your existing Self Assessment sign-in details.

What does not change: how much tax you owe, and when you pay it. There's no tax to pay at the quarterly stage — the bill is still calculated at year end and paid by 31 January, exactly as now.

The dates that matter

For the £50,000 wave, the tax year runs from 6 April 2026 and the quarterly updates are due on the 7th of the second month after each quarter ends:

• Q1 (6 Apr – 5 Jul 2026) → due 7 August 2026 — your first-ever update
• Q2 (6 Jul – 5 Oct) → due 7 November 2026
• Q3 (6 Oct – 5 Jan) → due 7 February 2027
• Q4 (6 Jan – 5 Apr) → due 7 May 2027
• Final Declaration (replaces the SA100) → due 31 January 2028

What to do now: a 6-step checklist

1. Check the letter is genuine on GOV.UK before doing anything else.
2. Confirm your 2024/25 gross self-employment + property income really is over £50,000.
3. Choose HMRC-recognised software from the GOV.UK list and try uploading a bank statement or two so categorisation is familiar before it counts.
4. Sign up for MTD for Income Tax on GOV.UK with your Self Assessment credentials (early is fine — you can sign up voluntarily now).
5. Put the four deadlines in your calendar: 7 Aug, 7 Nov, 7 Feb, 7 May, plus 31 January 2028 for the Final Declaration.
6. Start keeping income and expenses as you go, not in a January panic — quarterly updates reward steady record-keeping.

What if you're under the threshold

Mandation is based on the qualifying income shown on your Self Assessment for the relevant year, so an income drop afterwards doesn't automatically remove you. If you believe the letter is wrong — your income is genuinely below £50,000, or you qualify for an exemption — check HMRC's eligibility and exemption guidance and contact HMRC to confirm your position.

• Genuinely under £50,000 for 2026? You may not be required this wave — but you can sign up voluntarily to get used to it before your threshold year arrives.
• PAYE only, with a small side income under threshold? You're not in MTD ITSA yet — keep filing the annual return.
• Income near a threshold? Many people opt in a year early on purpose, to learn the four-quarter rhythm before it's compulsory.

The software you'll need

Once you're in scope, the GOV.UK Self Assessment return is no longer an option — you file through HMRC-recognised software that:

• keeps your income and expenses as digital records;
• tags each transaction to the right HMRC expense category;
• sends the four quarterly updates and the Final Declaration via HMRC's MTD ITSA API.

Bridging software (keep your spreadsheet, add an API layer) is allowed; end-to-end software (capture, categorise and submit in one place) is the lighter-touch route. Both are accepted by HMRC. For the mechanics of each quarterly update, see our guide to MTD ITSA quarterly updates.