HMRC to sign up taxpayers for MTD automatically from September

If you or your clients should be signed up for Making Tax Digital (MTD) for Income Tax for 2026-27 but are not, HMRC has confirmed that it will start automatically signing these taxpayers up from September. There’s still time to sign up before they do and keep control of the relevant information.

The first MTD quarterly update submission deadline for 2026-27 has now passed. HMRC has confirmed that more than 570,000 sole traders and landlords have signed up to MTD for 2026-27 and of those, over 436,000 have successfully submitted their first MTD quarterly update. If your client is signed up but is yet to submit their first quarterly update, they can do so using their compatible software without late penalty points for this year.

HMRC has confirmed that it will start to sign up the remaining customers who should be in MTD for 2026-27 and are not. It will do this in stages, starting from September 2026, based on taxpayer records that show qualifying income over £50,000 for the 2024-25 tax year. HMRC will then communicate with the taxpayer by letter or digitally, depending on the taxpayer’s communications preference.

HMRC will ask the taxpayer to share the communication with their agent – it will not send them a copy separately. Agents can see the information that will be sent to their clients in the agent toolkit.

What should you do if HMRC signs you or your clients up?

As a taxpayer or an agent for a client, after you receive the communication, you must access HMRC online services to check that the details HMRC holds about the taxpayer/client, including those it has based the automatic sign-up on, are correct. You’ll have the opportunity to add details of any new sources of qualifying income and inform HMRC of any sources of income that have ceased since the last self-assessment return submitted for the taxpayer.

If any other information needs to be changed, such as changing business address, description or name, you’ll need to contact HMRC. This may be particularly time-consuming if the taxpayer has multiple sources of qualifying income which need to be separately identified.

The taxpayer will then need to use compatible software to create digital records from the start of the year and catch up on overdue quarterly update(s) submissions to comply with their MTD obligations.

HMRC has published further guidance for taxpayers who are automatically signed up.

There’s still time to sign up before HMRC does it for you

If you or your clients should already be signed up for MTD for 2026-27, don’t wait for HMRC to do it for you. Taxpayers can still sign themselves up and agents can continue to sign up eligible clients throughout HMRC’s automatic enrolment process.

HMRC recommends signing up proactively as it gives the taxpayer/agent more control over the accuracy of the information used for the 2026-27 year and therefore that MTD obligations are created correctly.

As noted above, once HMRC has signed the taxpayer up, the process for correcting and updating information is less flexible and can potentially take longer.

If you, or your client do not believe that they need to be in MTD for 2026-27 (eg all qualifying income sources have ceased before 6 April 2026 or an exemption applies), you should contact HMRC directly to avoid them being signed up under the automatic process.

Making Tax Digital guidance

HMRC has published further guidance for taxpayers who are signed up by HMRC.

Links to all current HMRC MTD guidance can be found on our MTD Hub.

If you’re checking whether you or your clients need to be signed up for MTD for 2026-27, the following guidance is particularly relevant:

• Making Tax Digital for Income Tax - who needs to sign up
• Find out if you can get an exemption from Making Tax Digital for Income Tax
• Making Tax Digital for Income Tax for sole traders and landlords: step by step
• Making Tax Digital for Income Tax as an agent: step by step

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We respond to tax consultations and calls for evidence and attend meetings with HMRC at which service levels, delays and other issues you raise with us are discussed. We welcome input from members to inform our work.