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Use Making Tax Digital for Income Tax

From:
HM Revenue & Customs
Published:
22 April 2024
Updated:
16 July 2026 - See all updates

If your circumstances change

Find out what you need to do to keep your details up to date and when you need to tell HMRC about a change.

After signing up for Making Tax Digital for Income Tax, you may have a change in your circumstances.

You can make most changes using your HMRC online services account or agent services account. You may need to use your software for some changes.

If you need to change your tax return

Find out how to change your tax return in the Submit your tax return section.

If you are eligible to opt out

If you have been using Making Tax Digital for Income Tax, you can opt out if you no longer need to use it because:

  • you amended your Self Assessment tax return for the previous tax year taking your qualifying income below the relevant threshold

  • your qualifying income has been below the relevant threshold for 3 consecutive years

HMRC will use income information from your fourth quarterly update for the third year to check if you can opt out.

For example, if your qualifying income is above £50,000 for the 2024 to 2025 tax year, you will need to start using Making Tax Digital for Income Tax in April 2026.

You will be able to opt out after the end of the 2028 to 2029 tax year, if your qualifying income is:

  • £30,000 or less based on your 2025 to 2026 tax return

  • £20,000 or less based on your 2026 to 2027 tax return

  • £20,000 or less based on your fourth quarterly update for 2028 to 2029

You will need to have sent your fourth quarterly update for the 2028 to 2029 tax year by 7 May 2029. You would then not need to use Making Tax Digital for Income Tax for the 2029 to 2030 tax year.

If you are eligible to opt out, you will need to select this option in your HMRC online services account or agent services account. The option will only appear if you are eligible.

If you are opting out because your qualifying income was below the relevant threshold for 3 consecutive years, you will not need to wait until you send your tax return for the third year to opt out.

If you choose to opt out:

Using Making Tax Digital for Income Tax voluntarily

You can continue using Making Tax Digital for Income Tax if you do not opt out. Your HMRC online services account will show that you’re using the service voluntarily.

If you become exempt

After signing up for Making Tax Digital for Income Tax, you may become eligible for an exemption because your circumstances have changed.

For example, you may become digitally excluded meaning it’s not reasonable for you to use compatible software to keep digital records, send quarterly updates or submit your tax return.

You can find out if you can get an exemption from Making Tax Digital for Income Tax.

If HMRC has confirmed you’re exempt:

  • you will no longer need to create digital records or send quarterly updates

  • you must still report income and gains in a Self Assessment tax return

  • your penalties will change

If you become insolvent

If you continue to receive self-employment or property income after entering into a formal insolvency procedure, you will need to keep using Making Tax Digital for Income Tax.

If you do not continue receiving self-employment or property income, check the Add or cease income sources section.  

You can get help if you become insolvent.

If you have penalty points

If you have late submission penalty points and become insolvent, HMRC will reset your points total to zero.

If you continue to receive self-employment or property income after the tax year you became insolvent, penalty points and penalties will apply to you if you miss a submission or payment deadline as normal.

If you need to change your software

You can change the software you use for Making Tax Digital for Income Tax at any time, but you may find it easier to change your software at the end of the tax year.

You may choose to use different compatible software for different income sources.

If you change your software, you will still need to store your digital records for at least 5 years from the submission deadline for each tax year.

For example, your 2026 to 2027 tax return must be submitted through compatible software by 31 January 2028. You must keep the digital records for the tax year until at least 31 January 2033.

You should also make sure you can access your digital records from previous tax years. For example, you may need to export your digital records from your old software and store them securely.

If you need help with issues relating to your software, contact your software provider.

If you change your software after the end of a tax year

You need to store your digital records from previous tax years securely and be able to access them.

You do not need to import your digital records from previous tax years into the new software.

If you change your software during a tax year

If you use software to create digital records, you will need to either:

  • import your digital records into your new software for the current tax year

  • recreate the records in your new software

If you use software that connects to your records (bridging software) you will need to link your new software to your record-keeping software.

You must remove the link between your old bridging software and your records.

If you change your tax agent

If you change, add or remove a tax agent, digital records from previous tax years will not be transferred automatically between agents.

You’ll need to make sure that:

  • you have access to your digital records from previous tax years and store them securely

  • any tax agent acting for you is authorised to use Making Tax Digital for Income Tax on your behalf

  • you and your tax agent use Making Tax Digital for Income Tax software — speak to your agent for advice on which software to use

  • if you use different software products, these work together to meet your needs

  • the tax agent or agents acting for you have access to the digital records they need, including your previous records

  • if you stop using a tax agent, you remove their  authorisation in your HMRC online services account so they can no longer act for you

Find out how to choose agents for Making Tax Digital for Income Tax.