Feature
Making Tax Digital for Income Tax
Quarterly reporting means your books have to be current four times a year, not once.
What is mtd for income tax?
Making Tax Digital for Income Tax applies from 6 April 2026 to sole traders and landlords with qualifying income above £50,000, based on gross income rather than profit. It replaces one annual return with four cumulative quarterly updates plus a Final Declaration. Nella does not file these updates. What it does is keep your figures current and visible between them, and track when each date falls, so the quarter is not a scramble.
What sits behind the number.
Who is in scope now
Sole traders and landlords with qualifying income above £50,000 in 2024/25, from 6 April 2026. The threshold falls to £30,000 from April 2027 and £20,000 from April 2028.
What is due
Four quarterly updates for 2026/27, then a Final Declaration. The updates are cumulative, so each one restates the year to date.
When
Quarterly updates for 2026/27 fall on 7 August 2026, 7 November 2026, 7 February 2027 and 7 May 2027. The Final Declaration for 2026/27 is due 31 January 2028.
What it does not change
Quarterly updates create no payment obligation. Tax payment dates are unchanged.
What it does not do
Stated plainly, because a figure you can trust is one whose limits you know.
- Nella is not MTD-compatible filing software and does not submit quarterly updates or the Final Declaration to HMRC. Filing is done through compatible software or by your accountant.
- Nella reads your accounting ledger. Income recorded outside that ledger is not visible to it.
- 2026/27 is a soft-landing year: no late-submission penalty points for quarterly updates, though all four must still be filed before the Final Declaration. Points begin to apply from 2027/28.
Figures stated for the 2026/27 tax year. Thresholds and dates change; check GOV.UK for the position that applies to you, and speak to a qualified accountant about your own circumstances.
Nella provides financial information and education, not accounting or tax advice. Nella shows you the numbers; a qualified accountant at AccTek advises you on them. When a question needs professional judgement, Nella points you to the team.
Where the data comes from
Nella connects read-only to Xero, QuickBooks, Sage, FreeAgent. It cannot create, edit or delete anything in your books. How deeply it reads varies by platform — see the supported-platform table — and how your data is handled is set out in full.