HMRC MTD automatic sign-up: what to do next in 2026
Guidance checked on 8 September 2026
HMRC is starting to sign up people automatically for Making Tax Digital for Income Tax from September 2026 where its records show they should already be using the service. If you receive a confirmation, you still need to check your information, arrange compatible software and deal with any outstanding digital records and quarterly updates.
Automatic sign-up does not organise your bookkeeping for you. It also does not remove the need to understand whether the rules apply to your circumstances. The most useful response is a clear plan covering your records, software and next submission.
This guide is for sole traders and landlords, including those in Bromley, London and elsewhere in the UK. It explains what the September change means and how to move from receiving a letter to having a workable routine.
What is changing with HMRC MTD automatic sign-up?
HMRC says it will sign up people who need to use Making Tax Digital for Income Tax for 2026/27 and have not registered themselves or through an agent. This will happen in stages over the coming months, with confirmation sent after sign-up.
HMRC uses information it already holds. That information may not reflect a new business, a property income source that has stopped, or other changes since your last return. This is why checking the record matters. If HMRC has not signed you up, you can still sign yourself up or ask your agent to do it. See the official sign-up guidance.
Do not assume that everyone affected will receive a letter on the same day. Equally, the absence of a letter is not evidence that you are outside MTD. Check the rules against your own income and circumstances.
First, confirm whether you need MTD for Income Tax
The first mandatory group comprises qualifying sole traders and landlords with more than £50,000 of qualifying income in 2024/25, subject to exemptions. Their start date was 6 April 2026. The following stages use more than £30,000 in 2025/26 for an April 2027 start, and more than £20,000 in 2026/27 for an April 2028 start.
Use HMRC's eligibility and start-date guidance. Pay attention to the tax year being tested: your latest bank balance or this month's profit is not the threshold calculation.
Qualifying income is broadly the combined gross income from self-employment and property before expenses. Employment income, dividends and pensions do not form part of this calculation. There are additional rules for situations such as short accounting periods and jointly owned property, so use the qualifying income guidance where relevant.
An example of why the combined figure matters
Suppose a sole trader had £38,000 of business turnover and £16,000 of gross property income in 2024/25. Their combined qualifying income would be £54,000. Assuming no exemption or other adjustment applies, looking at the business turnover alone would give the wrong answer about the April 2026 requirement.
This is an illustrative example, not a calculation of the person's taxable profit or tax bill. Expenses may affect those figures, but they do not simply reduce the gross-income threshold test.
If HMRC has signed you up, check these records
HMRC's instructions after automatic sign-up explain how to access the MTD section through HMRC online services and check your self-employment and property information.
Review each income source. Add anything missing and report sources that have ceased. HMRC treats your UK properties together as one UK property business and your overseas properties together as one foreign property business. If your position is complicated, work through it with your accountant rather than guessing at the setup.
Keep a short note of what you checked and any questions still unresolved. If the record shows an old activity, establish whether it needs to be marked as ceased rather than merely ignored. Where all relevant income sources have stopped, the dates matter to your remaining obligations.
If you believe you should not be using MTD, check the exemption rules and contact HMRC as appropriate. Simply leaving the account untouched will not resolve an incorrect record.
Choose software for the whole year's work
Software needs to do more than hold a list of receipts. Your chosen product or combination of products must support digital records, quarterly updates and the annual tax return, including the other income information needed to complete it.
HMRC offers a software finder and explains both all-in-one products and bridging software that connects existing records, such as spreadsheets. Check that your choice supports your income sources and accounting period. If you already use software for VAT, check its Income Tax compatibility separately. See HMRC's software guidance.
Before committing to a product, ask practical questions: who will enter transactions, who will resolve queries, who will send updates, and how will your accountant access the records? A tool that nobody knows how to use is unlikely to improve the process.
If you want ongoing support, discuss the software with your accountant first so your bookkeeping and filing arrangements work together.
Connect the software and check the accounting period
Signing up to MTD and authorising software are separate steps. Your software must be connected to HMRC before you use it for the required work. You should also check its accounting-period settings before sending your first quarterly update.
HMRC's guidance distinguishes standard tax-year periods from calendar periods. Where your accounting period runs from 1 April to 31 March, select the appropriate calendar setting before the first update. The guidance says the accounting period cannot be changed after an update has been sent, so this deserves attention during setup. Follow HMRC's software preparation steps.
Ask your accountant to confirm these settings if you are uncertain. Keep a record of successful authorisation and check that the expected obligations appear, rather than treating installation as the final step.
Catch up on records and overdue quarterly updates
By September 2026, the first quarterly update deadline of 7 August has already passed. People brought into the service now may therefore have work to catch up on. HMRC says to create the required digital records and send overdue updates as soon as possible.
Start by assembling the source material: sales records, bank transactions, receipts, rental statements and details of relevant cash transactions. Identify missing periods before importing or entering everything into the software.
Do not assume a bank feed gives a complete and correctly classified picture. Check for duplicate imports, transfers, personal spending and transactions recorded elsewhere. A receipt or invoice may also contain information that a bank description cannot explain.
The start date for records depends on the accounting period: HMRC's first-year guide refers to 6 April for standard periods and 1 April for calendar periods. Confirm which applies to you and work forward systematically. See the first-year MTD guide.
What quarterly updates do, and the dates to remember
Quarterly updates are summaries of income and expense categories. They are not four separate tax returns. The figures come from your digital records, and each update covers the year to date. Your software calculates the totals for you to check before submission.
HMRC receives the category totals rather than copies of individual receipts or invoices. You still need to deal with each relevant self-employment and property business. Read the quarterly update guidance for the detailed rules.
For the 2026/27 cycle, the update deadlines are:
7 August 2026 — first update.
7 November 2026 — second update.
7 February 2027 — third update.
7 May 2027 — fourth update.
The previous year's 2025/26 Self Assessment return is still due through the usual route by 31 January 2027. The 2026/27 MTD tax return is due through compatible software by 31 January 2028. HMRC sets out both in its MTD timeline.
Quarterly reporting does not create four new Income Tax payment dates. Keep your existing payment obligations, including any payments on account, in your calendar as well.
Do first-year penalty arrangements mean you can wait?
No. HMRC says it will not apply penalty points for late quarterly updates for 2026/27. However, digital record keeping and the updates are still required, and the necessary updates must be completed before the tax return can be submitted. Late tax returns and late payment remain subject to penalties. See the penalty section in the current sign-up guidance.
Treat this transition as time to establish a sustainable routine. Leaving the records until the annual return creates a larger job and makes it harder to investigate missing information while events are fresh.
A manageable action plan for this week
Check your position. Review the relevant return, gross income and possible exemptions. Keep HMRC's confirmation with your tax records.
Confirm the account details. Review each business and property income source, and identify changes since the return HMRC used.
Agree the setup. Choose compatible software, confirm agent responsibilities, authorise the connection and check the accounting period.
Clear the backlog. Gather missing records, review transactions and establish which updates are overdue before submitting them.
Set a regular routine. Schedule bookkeeping time and a review ahead of each deadline. Keep submission confirmations and chase unresolved queries.
You do not have to solve every question in one sitting. A list showing the task, the person responsible and the next action can turn an unfamiliar process into a series of manageable jobs.
What if digital record keeping is not reasonable for you?
Some people can be exempt, including where they are digitally excluded. Other exemptions may be automatic or temporary. HMRC assesses the relevant conditions; being unfamiliar with accounting software alone is not an accepted reason for a digital-exclusion exemption.
Check the official exemption guidance and follow the appropriate process. An exemption from MTD does not remove the obligation to report income through Self Assessment.
Making Tax Digital help in Bromley, London and across the UK
Mysimplytax's MTD service covers Sage accounting software, digital bookkeeping, quarterly HMRC updates and annual Self Assessment support. The team can also help with setup and registration where required. This brings the recurring record keeping and filing work into one agreed service.
Visit our Making Tax Digital support page or contact mysimplytax to discuss your circumstances. Have your latest tax return, HMRC correspondence and a summary of your income sources ready. That gives the team a useful starting point for checking what needs to happen next.
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