MTD for VAT — Already Live
MTD for VAT became mandatory for most VAT-registered businesses on 1 April 2019 and was extended to all VAT-registered businesses on 1 April 2022. There is no further start date to wait for — if you are VAT-registered, MTD applies now.
MTD for Income Tax Phase 1 (April 2026)
From 6 April 2026, MTD for Income Tax applies to sole traders and landlords whose qualifying income exceeds £50,000.
MTD for Income Tax Phase 2 (April 2027)
From 6 April 2027, the threshold falls to £30,000, bringing more sole traders and landlords into MTD.
MTD for Income Tax Phase 3 (April 2028)
From 6 April 2028, the threshold falls again to £20,000, extending MTD to nearly all sole traders and landlords with meaningful self-employment or property income.
MTD for Corporation Tax — Future Plans
HMRC is exploring how to extend MTD to limited companies. No mandatory start date has been confirmed.
Which tax year decides your start date
HMRC looks at the qualifying income reported on your most recent finalised Self Assessment return before each start date. For the April 2026 start, that is generally your 2024/25 return (filed by 31 January 2026). So the income that pulls you into MTD is not the current year’s — it is the income you have already reported. If you cross a threshold, HMRC writes to you, but it is worth checking your own figures rather than waiting for a letter.
Why the rollout is phased
MTD for Income Tax is being introduced in waves — £50,000, then £30,000, then £20,000 — so that the largest and best-resourced taxpayers move first and HMRC can refine the system before it reaches smaller businesses. If you are below £20,000 you are not currently required to join, though the government has said it will keep this under review.
What if your income changes?
Because HMRC uses a past return to decide your start date, a temporary dip the year you would join does not necessarily take you back out — and once you are in MTD you generally stay in. If your income falls consistently below the threshold over time, there are rules that can let you leave, but the safe assumption is that crossing a threshold is a one-way door. If you are close to a threshold, plan as though you will be in from the relevant date.
How to Check Your MTD Start Date
Your start date depends on your qualifying income and tax type. Use our free eligibility check to confirm your position in a couple of minutes.