What is MTD for Income Tax Self Assessment?
Making Tax Digital for Income Tax Self Assessment (MTD ITSA) replaces the annual SA100 self-assessment return with a continuous digital reporting cycle. Instead of one return per year, you submit four quarterly updates, an End of Period Statement, and a Final Declaration.
It is mandatory — not optional — for anyone above the income threshold.
Who is affected?
- **From April 2026:** sole traders and landlords with gross income above **£50,000**
- **From April 2027:** sole traders and landlords with gross income above **£30,000**
- **From April 2028 (proposed):** income above £20,000
Partnerships and limited companies are not in this phase of MTD ITSA.
What you submit — and when
Four quarterly updates — each is a summary of income and expenses for the quarter:
| Quarter | Period | Deadline |
|---|---|---|
| Q1 | 6 April – 5 July | 5 August |
| Q2 | 6 July – 5 October | 5 November |
| Q3 | 6 October – 5 January | 5 February |
| Q4 | 6 January – 5 April | 5 May |
Quarterly updates are not tax returns — they give HMRC an in-year estimate of your liability. You don't pay quarterly; payment dates remain 31 January and 31 July.
End of Period Statement (EOPS) — finalise the year: add adjustments for private use, capital allowances, and year-end elections.
Final Declaration — replaces the SA100. Confirms your total income from all sources and calculates your bill.
Digital record-keeping requirements
Every transaction must be recorded digitally from the point it occurs. A spreadsheet bridged to a third-party app is acceptable, but you cannot enter aggregated totals — each sale and expense must be a separate digital record.
How Finovo handles MTD ITSA
Connect your bank account and categorise income and expenses as normal. Finovo generates the quarterly update automatically from your records:
- 1Open **Taxes → MTD ITSA**
- 2Review the period figures — split by income type and expense category
- 3Click **Submit to HMRC** — sent directly via the MTD API
At year end, Finovo prepares your EOPS and walks you through the Final Declaration.
Start before you have to
MTD ITSA requires digital records from the start of the tax year in which you cross the threshold — not from the date you sign up. If your income is approaching £50,000, start keeping digital records now.
Missing a quarterly update triggers penalty points under HMRC's new system — four points in a year means a £200 fine.