Comparison
| What changes | Self Assessment | Making Tax Digital |
|---|---|---|
| Filing frequency | 1 annual return (SA100) | 4 quarterly updates + 1 final declaration |
| Filing deadline | 31 January (online) following tax year end | Quarterly: 7 Aug / 7 Nov / 7 Feb / 7 May. Final: 31 January |
| Record-keeping | Paper or digital — your choice | Mandatory digital records in MTD-compatible software |
| Software required | Optional | Required (or spreadsheet + bridging software) |
| Who's in scope | Anyone HMRC asks to file | Sole traders & landlords above qualifying income threshold |
| Threshold | n/a | £50k from Apr 2026, £30k from Apr 2027, £20k from Apr 2028 |
| Tax payments | 31 Jan (balancing) + 31 Jul (POA) | Same dates — payment timing does NOT change |
| Penalty regime | Fixed-fee late filing & late payment | Points-based late submission + percentage-based late payment |
| Visibility of tax position | Once a year | Real-time running estimate after each quarter |
| Cash flow planning | Backward-looking | Forward-looking quarterly estimates |
| Admin time | Concentrated in January | Spread across the year (lower per-month burden if records are kept current) |
| Cost of compliance | Free filing via HMRC online | Software cost (free options exist) |
The Headline Differences
- Cadence: 1 annual return becomes 5 submissions per year (4 quarterly + 1 final).
- Records: paper / spreadsheet record-keeping becomes mandatory digital records.
- Tools: HMRC's free online return is replaced by third-party MTD software (or bridging software).
- Penalties: fixed late-filing fines become points-based — three points triggers a £200 penalty.
- Visibility: you see a running estimate of your tax bill after each quarter, not just in January.
What Stays Exactly The Same
- Income Tax bands and rates (20% / 40% / 45%).
- Personal Allowance (£12,570) and £100k taper.
- Class 2 and Class 4 National Insurance.
- Payments on Account (31 January and 31 July).
- Balancing payment date (31 January).
- Allowable expenses and capital allowances.