Purpose
HMRC has confirmed that from September 2026 it will start automatically signing up people who should already be using Making Tax Digital for Income Tax but have not registered themselves.
Who is affected?
The change affects sole traders and landlords whose qualifying income from self-employment and property was more than £50,000 in 2024/25. They should have been using MTD for Income Tax from 6 April 2026.
If they have not signed up, HMRC will begin enrolling them in stages over the coming months.
Why this matters
HMRC will use the information it already holds when completing the automatic sign-up. That information may not reflect changes made after the latest tax return, such as a business stopping, a property being sold or another income source starting.
It is therefore sensible to check the client's current circumstances and make sure HMRC's records are correct.
Agents can still act first
HMRC is still allowing taxpayers and their agents to complete the sign-up themselves before automatic enrolment takes place.
For agents, doing this first gives greater control over the information entered and reduces the risk of incorrect income sources being carried into the MTD record.
What happens after sign-up?
Being enrolled does not remove the normal MTD requirements. Those affected must use compatible software, keep digital records and submit quarterly updates.
HMRC has confirmed that penalty points will not be issued for late quarterly updates during 2026/27. Normal penalties for late tax returns and late payment can still apply.
Key takeaway
If you or your client should already be within MTD for Income Tax, do not assume HMRC's automatic sign-up will deal with everything correctly. Check the record, confirm the income sources and bring any outstanding digital records up to date.
