Making Tax Digital for Income Tax (often shortened to MTD for Income Tax, or MTD ITSA) is a change in how landlords and the self-employed keep records and report income to HM Revenue & Customs (HMRC). Instead of submitting one Self Assessment tax return at the end of the year, you keep digital records and send HMRC regular updates throughout the year, using recognised software like Nexus.
This article explains the basics: what MTD is, whether it applies to you, and what you'll need to do. For the steps to set up inside Nexus, see Connecting to HMRC and Managing Quarterly Submissions.
What is Making Tax Digital for Income Tax?
Under MTD for Income Tax, you will need to:
Keep digital records of your property income and expenses
Send HMRC a quarterly update summarising your income and expenses for each income source
Submit a Final Declaration after the end of the tax year, which replaces the Self Assessment tax return and confirms your figures for the year
The aim is to give you a clearer, updated view of your tax position throughout the year, rather than reconstructing everything at year end.
Who needs to comply, and when?
MTD for Income Tax is being introduced in phases, based on your gross qualifying income. The phases are:
From 6 April 2026 — if your gross qualifying income is over £50,000
From 6 April 2027 — if your gross qualifying income is over £30,000
From 6 April 2028 — if your gross qualifying income is £20,000 or more
HMRC will normally write to you if their records show you need to join. However, the responsibility to check whether you're in scope and to sign up remains with you. You can confirm your position using HMRC's online checker tool.
What counts as "qualifying income"?
Qualifying income is your combined gross income from self-employment and property, before any expenses are deducted. It's the total of these sources added together that matters — not each one on its own.
For example, if you earn £25,000 in rental income and £35,000 from self-employment, your qualifying income is £60,000. That puts you in the first phase from April 2026, even though neither source on its own is above £50,000.
Quarterly update deadlines
For the standard quarterly periods, updates are due by:
7 August (for the quarter to 5 July)
7 November (for the quarter to 5 October)
7 February (for the quarter to 5 January)
7 May (for the quarter to 5 April)
Quarterly updates are cumulative within the tax year. Submitting them does not calculate your final tax bill — that's confirmed at the Final Declaration stage.
How Nexus helps
Nexus is designed to make MTD for Income Tax straightforward for landlords whose properties are managed by a letting agent:
Your income and expenses are pulled through automatically from your letting agent's system
You connect securely to HMRC directly from Nexus
You can review your figures and submit your quarterly updates from one place
To get started, see Getting Started with Nexus: An Overview, then Connecting to HMRC.
This article is general guidance to help you understand Making Tax Digital and is not tax advice. The rules and thresholds are set by HMRC and may change. If you're unsure whether MTD applies to you, check HMRC's guidance or speak to a qualified accountant or tax adviser.