Making Tax Digital for Income Tax is now live. Since 6 April 2026, sole traders and landlords across Hampshire and Berkshire with qualifying income above £50,000 must keep digital records and send HMRC quarterly updates. The threshold falls again in April 2027 and April 2028, which means thousands more self-employed people and landlords in Basingstoke, Reading, Newbury and Winchester will be brought in over the next two years.
This guide explains who is affected, when, and what you need to do now.
Who has to use Making Tax Digital, and when?
MTD for Income Tax is being introduced in three stages, based on your qualifying income:
- From 6 April 2026: qualifying income over £50,000
- From 6 April 2027: qualifying income over £30,000
- From 6 April 2028: qualifying income over £20,000
HMRC uses the figures on your previous Self Assessment tax return to decide whether you are in scope. If your earlier return showed qualifying income above the relevant threshold, you should expect HMRC to write to you, but you are responsible for complying whether or not a letter arrives.
What counts as qualifying income?
Qualifying income is your total gross income from self-employment and property, before any expenses are deducted. Both sources are added together.
For example, a Basingstoke electrician with £22,000 of turnover who also lets a flat in Reading for £12,000 a year has qualifying income of £34,000. They are outside MTD for 2026/27, but they will need to comply from April 2027.
Employment income, pensions, dividends and savings interest do not count towards the threshold.
What changes in practice?
1. Digital records
You must keep your income and expense records in HMRC-recognised software. Spreadsheets on their own are no longer enough unless they are connected to compatible bridging software. We work with Xero, QuickBooks, FreeAgent and Capium, all of which are MTD-ready.
2. Four quarterly updates a year
Each update is a summary of your income and expenses for the quarter. It is not a tax return and no tax is paid at this stage. For a standard tax year the deadlines are:
- 7 August (for 6 April to 5 July)
- 7 November (for 6 July to 5 October)
- 7 February (for 6 October to 5 January)
- 7 May (for 6 January to 5 April)
3. A final declaration
After the year ends, you confirm your figures and make any adjustments in a final declaration, due by 31 January. This replaces the Self Assessment tax return for your business and property income. The dates on which you pay your tax do not change.
Penalties
MTD uses a points-based system for late submissions. For 2026/27, HMRC has said it will not issue penalty points for late quarterly updates, although all four updates must still be sent before you can submit your final declaration. From 2027/28, each missed quarterly deadline earns a point, and reaching four points triggers a £200 penalty. Points expire after a period of compliance.
The first year is the time to get your systems right, not a reason to delay.
What landlords in Hampshire and Berkshire should check
Rental income in Reading, Wokingham, Basingstoke and Winchester means many landlords cross the £30,000 and £20,000 thresholds on rent alone. If you own property jointly, speak to us about how your share is treated. If you also run a business, remember that your rental income and trading income are added together.
What to do now
- Check your last tax return. Add together your gross self-employment and property income.
- Choose MTD-compatible software before your start date, not after it.
- Move your records from paper or spreadsheets into the software, and connect your bank feeds.
- Diary the quarterly deadlines, or let your accountant handle them for you.
How Gowin Accountants can help
We are a Basingstoke-based firm of accountants, members of the Institute of Financial Accountants, working with sole traders and landlords across Hampshire and Berkshire. Our fixed-fee packages include setting up your MTD software, submitting your quarterly updates and preparing your final declaration, so you never miss a deadline.
Call us on 01256 578106 or contact us for a free, no-obligation chat about Making Tax Digital.
This article is for general information and reflects the rules in place in October 2026. It is not tailored advice. Please speak to us about your own circumstances.