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What Making Tax Digital for Income Tax is聽

Making Tax Digital for Income Tax is a new way of reporting income and expenses if your client is a sole trader or landlord. You鈥檒l need to use聽software that works with Making Tax Digital for Income Tax听迟辞:听

• create, store and correct digital records of your business income and expenses 聽
• send your quarterly updates to HMRC鈥���
• submit your tax return and pay tax due by 31 January the following year

Who should sign up and when鈥���

Making Tax Digital for Income Tax is currently voluntary. You may be able to sign up your client to help us test and develop the service. If your client wants to sign up at this stage, they can choose whether they want you to sign up them up:

• for testing
• early, so you and your client are prepared to use the service

HMRC will check that your client is eligible to sign up based on the details that you provide.

From 6 April 2026, some of your clients will need to use Making Tax Digital for Income Tax. Whether your client needs to sign up depends on their total annual income from self-employment or property.

If you know when your client needs to sign up, you can read use Making Tax Digital for Income Tax to find out more information about:

• what to expect after you sign up
• the different steps you will need to take during the tax year
• help and support

If your client chooses to sign up now

You or your client will still need to send a Self Assessment tax return for the 2024 to 2025 tax year.

If your client will need to sign up in future聽

You can either:聽

• sign up to test the service now, for all your client鈥檚 self-employment and property income sources聽鈥� once signed up you will not need to sign up your client again
• continue sending a Self Assessment tax return as normal and sign up at a later date

Who can sign up voluntarily

We鈥檒l ask you some questions when you sign up your client. This will confirm if they鈥檙e able to sign up voluntarily.

You can sign up your client voluntarily if all of the following apply:聽

• their personal details are up to date with HMRC聽
• they鈥檙e a UK resident聽
• they have a National Insurance number
• they have submitted at least one Self Assessment tax return, or you have done this on their behalf聽
• they鈥檙e up to date with their tax records 鈥� for example, they have no鈥痮utstanding tax liabilities聽
• their accounting period runs from either:
  • 6 April to 5 April
  • 1 April to 31 March 鈥� you must make sure you and your client鈥檚 software can support this accounting period

Who cannot sign up voluntarily聽

You cannot sign up your client voluntarily if they:聽

• have a payment plan with HMRC鈥���
• are a partner in a partnership鈥���
• claim Married Couple鈥檚 Allowance鈥���
• claim Blind Person鈥檚 Allowance鈥���
• are currently, or are going to be, bankrupt or insolvent鈥���
• are an MP, minister of religion or Lloyds underwriter鈥���
• have income from being a foster carer or being in a shared lives scheme鈥���
• have income from a trust
• have income from a furnished holiday let
• are subject to a compliance enquiry聽
• use 鈥榓veraging鈥� or other arrangements because their profits vary between years 鈥� for example, because they鈥檙e a farmer, writer or artist

Before you sign up your client聽

1. Check if your client can sign up for Making Tax Digital for Income Tax.听

2. Get compatible software that works with Making Tax Digital for Income Tax.听

3. Create an agent services account if you do not have one already one. Your agent services account is different to your HMRC online services for agents account.听

4. Get your client鈥檚 details and details of their income sources.听

5. Get your client鈥檚 permission to sign them up.听

6. Get your client to authorise you. What you need to do depends on if you are already authorised by your client for Self Assessment or not.

Choose your software聽

You and your client will need to get software that works with Making Tax Digital for Income Tax. When choosing software, always check with the software provider to make sure it meets your needs.听

What client details you鈥檒l need

You鈥檒l need your client鈥檚:聽

• full name鈥���
• date of birth
• National Insurance number鈥���

If your client is a sole trader, you鈥檒l also need:聽

• their business name 鈥� this is the name they use on their invoices鈥���
• their business address聽
• the nature of their business (their trade)

For each of your client鈥檚 income sources, you鈥檒l need:聽

• their business start date or the date they started receiving property income聽(if this is within the last 2 tax years)
• the accounting method such as cash basis accounting or traditional accounting鈥���
• the tax year your client would like to start using Making Tax Digital for Income Tax

Your client鈥檚 accounting period

If your client uses an accounting period that runs from 1 April to 31 March, you should make sure the software they choose supports this.鈥痀ou or your client must also:聽

• select calendar update periods in the software before the first update is made聽
• make an adjustment at the end of the first tax year 鈥� so that their income and expenses from 1 April to 5 April are included in their tax return

Get your client鈥檚 permission聽聽

You should talk to your client before you sign them up. You should tell them:聽

• what you鈥檙e signing them up to鈥���
• what it means for them

HMRC鈥檚 new penalties will apply to your client if they miss deadlines for:

• submitting their tax return
• paying their bill

Your client will not receive a penalty during the testing phase for missing a deadline for submitting a quarterly update.

You should read more information about the new penalties and when they apply.

We鈥檒l write to your client to confirm when they鈥檝e become liable for these penalties.听

Add your client authorisation聽

Your existing client authorisations for Self Assessment are recognised for Making Tax Digital. If you are already authorised by your client:聽

• for Self Assessment in your HMRC online services account only, you may need to add your authorisation from your HMRC online services account to your agent services account before you sign up your client聽
• for Self Assessment in your agent services account already, or through a digital handshake for Making Tax Digital for Income Tax, you can sign up your client 鈥� see 鈥楬ow to sign up your client鈥� section聽

If you are not already authorised by your client for Self Assessment, you will need to sign into your agent services account and follow the steps in your account to ask your client to authorise you.听

Adding your client authorisation to your agent services account will not remove it from your HMRC online services account.听

How to sign up your client鈥���

You鈥檒l need the Government Gateway user ID and password you got when you signed up for an agent services account.听

Next steps

Read more information about how to use Making Tax Digital for Income Tax.

If you have a query about your software (such as creating records and sending updates), contact your software provider.