HMRC has stated it will continue to evaluate Making Tax Digital for Income Tax as the scheme expands to include those with qualifying income over £30,000 from April next year. The initiative became mandatory in April 2026 for landlords and sole traders whose qualifying income exceeded £50,000.
The government's MTD impact assessment estimates that those with qualifying income above £50,000 may face an average one-off transitional cost of £285 and additional annual costs of £115. For those with qualifying income between £30,000 and £50,000, average transitional costs may be £350, with additional annual costs of £110.
Research from Tide indicates that landlords could spend an average of six full days dealing with Making Tax Digital administration. Nearly half of qualifying sole traders and landlords (44%) expect this administration to reduce their normal working hours, with 36% stating it will impact time spent serving clients.
More than half (58%) anticipate the process will take over a working week, and 13% predict it will require more than 10 full days in the first year alone. The data also suggests that 38% expect to complete MTD admin in the evenings, 35% at weekends, and 32% during planned time off or holidays.