MTD for Income Tax April 2027: the £30,000 cohort explained

Quick answer: If your combined gross self-employment and property income was over £30,000 on your 2025/26 Self Assessment return, you must use Making Tax Digital (MTD) for Income Tax from 6 April 2027. HMRC identifies you from that return (filed by 31 January 2027), and — unlike the £50,000 cohort — there is no penalty soft landing for you. Not sure if you're caught? Run the MTD scope checker, then map your dates with the MTD deadline calculator.

Making Tax Digital for Income Tax arrives in waves. The first wave (qualifying income over £50,000) started on 6 April 2026. The second wave is you: the £30,000 cohort, mandated from 6 April 2027. This guide explains exactly who is caught, how HMRC finds you, what to do during 2026 to prepare, and why you don't get the penalty breathing room the first wave received.

Who is caught in the April 2027 cohort

You are mandated into MTD for Income Tax from 6 April 2027 if your qualifying income was over £30,000 on your 2025/26 Self Assessment return.

The threshold is a strict "over" — £30,000 exactly is not caught; £30,000.01 is. HMRC set out the thresholds and dates in Find out if and when you need to use Making Tax Digital for Income Tax.

Qualifying income is the key term, and it is not the same as taxable profit:

• It is your gross self-employment turnover (sales before any expenses) plus your gross property income (rents before expenses).
• It counts self-employment and property income only.
• It excludes PAYE salary, dividends, savings interest, pension income and partnership income.

So a sole trader with £22,000 of turnover and rental income of £10,000 has qualifying income of £32,000 — over the threshold, even if their actual profit after expenses is far lower. See HMRC's work out your qualifying income guidance for the full definition.

The three mandation waves at a glance

If you're near the £20,000 line rather than £30,000, you're in the third wave, not this one — but it's worth knowing it's coming.

How HMRC identifies the £30,000 cohort

You don't opt in by declaring yourself. HMRC works out who is in scope by reading your Self Assessment return.

For the April 2027 cohort, the return that matters is your 2025/26 return, which is due by 31 January 2027. When HMRC processes it and sees qualifying income over £30,000, they will write to you confirming you must start using MTD for Income Tax from 6 April 2027.

Two things to keep in mind:

1. The letter is a courtesy, not the trigger. HMRC's guidance is explicit: "If you do not receive a letter, it is still your responsibility to check if and when you need to use Making Tax Digital for Income Tax." Don't wait for the post to arrive.
2. The timing is tight. Because HMRC uses the 2025/26 return, the number you file by 31 January 2027 determines your fate for a start date barely two months later. If you file late, you may be identified late — but you'll still be mandated.

If you'd rather not wait for HMRC's arithmetic, the MTD scope checker applies the same rules to your figures in under a minute.

Why there is no soft landing for you

This is the point most £30,000 earners miss, so it's worth stating plainly.

The government granted a soft landing on late-submission penalty points for the 2026/27 tax year only — and that year is the £50,000 cohort's first year. HMRC's penalties guidance confirms it: "There are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year." (See Penalties for Making Tax Digital for Income Tax.)

The £30,000 cohort's first year is 2027/28 (starting 6 April 2027). That year is not covered. So:

• Your quarterly updates are subject to late-submission penalty points from day one.
• The points system has a 4-point threshold: you get one point per missed quarterly update or final declaration, and once you hit 4 points you incur a £200 penalty, plus £200 for each further miss.
• Late-payment penalties and interest always apply regardless of cohort — the soft landing never covered those, even for the £50,000 group.

The takeaway: the first wave got a year to fumble the deadlines without points. You do not. Treat 7 August 2027 (your first quarterly update deadline) as a hard date.

What the £30,000 cohort actually has to do

Once mandated, Self Assessment as you know it is replaced. From 6 April 2027 you must:

1. Keep digital records of your self-employment and property income and expenses.
2. Send four quarterly updates — cumulative, year-to-date figures — due 7 August, 7 November, 7 February and 7 May.
3. Submit a final declaration by 31 January after the tax year, which replaces your old SA return and is where you make adjustments, claim reliefs and confirm the figures.

That's five submissions a year instead of one. The MTD deadline calculator turns your accounting dates into the exact five dates you'll need to hit.

Worked example: Priya, a caught sole trader

Priya runs a freelance design business and lets one flat.

• 2025/26 turnover (design): £24,500 (gross, before expenses)
• 2025/26 rental income: £8,400 (gross rent, before letting costs)
• Qualifying income: £24,500 + £8,400 = £32,900

£32,900 is over £30,000, so when Priya files her 2025/26 return by 31 January 2027, HMRC identifies her for the April 2027 cohort. She's mandated from 6 April 2027.

Note what does not change the answer: Priya also earns £15,000 from a part-time PAYE job. That salary is excluded from qualifying income — it neither pushes her over nor keeps her under. And her rental profit after the mortgage interest restriction (Section 24) doesn't matter here either — qualifying income uses gross rent, not profit.

From 6 April 2027, Priya keeps digital records, sends her first quarterly update by 7 August 2027, and — with no soft landing — earns a penalty point if she misses it.

What to do in 2026 to prepare

You have a genuine head start. Use 2026 to:

• Check your position now. Estimate your 2025/26 gross self-employment + property income and run it through the MTD scope checker. If you're close to £30,000, treat yourself as in-scope.
• Get your 2025/26 return right and on time. It's the return HMRC uses to identify you — file it accurately by 31 January 2027.
• Move to digital record-keeping early. Waiting until April 2027 to start keeping records digitally is the most common way to fall behind. Start now, on real transactions.
• Sign up voluntarily if you're ready. HMRC lets you sign up before you're mandated to test the process — though remember volunteers have their own penalty rules.
• Understand your numbers. Use the self-employed tax calculator to see how income tax and Class 4 NIC stack up on your profit, so the quarterly rhythm doesn't surprise you.

Ledgers is built for exactly this cohort: it owns your ledger, keeps digital records as transactions land, and prepares the four quarterly updates plus the final declaration — so the switch to five submissions a year is bookkeeping you've already done, not a scramble. This guide is general guidance, not personalised tax advice; check your own position with HMRC or your accountant.

Frequently asked questions

I'm just under £30,000 — am I safe?

For now, yes: the £30,000 threshold is strict "over", so £30,000 exactly or below is not caught in the April 2027 wave. But the third wave brings in qualifying income over £20,000 from 6 April 2028, measured on the 2026/27 return — so most sole traders and landlords will be in scope within a couple of years. Check both with the MTD scope checker.

Does my salary or dividend income count towards the £30,000?

No. Qualifying income is gross self-employment turnover plus gross property income only. PAYE salary, dividends, savings interest, pensions and partnership income are all excluded when testing the threshold, per HMRC guidance.

Do I really get no soft landing?

Correct. The soft landing on late-submission penalty points applies to the 2026/27 tax year only — the £50,000 cohort's first year. The £30,000 cohort's first year is 2027/28, which is not covered, so quarterly-update penalty points apply from the start. Late-payment penalties and interest apply to everyone regardless.

What if HMRC never sends me a letter?

You're still mandated if you meet the threshold. HMRC's guidance states it remains your responsibility to check whether and when you must join, letter or no letter. Don't rely on the post — verify your own position.

When is my first MTD deadline?

If you're mandated from 6 April 2027, your first quarterly update (covering 6 April to 5 July 2027) is due 7 August 2027. The remaining updates fall on 7 November, 7 February and 7 May, and your final declaration is due 31 January 2029. The MTD deadline calculator lays out your exact dates.