HMRC update guidance on MTD exemptions for averaging relief

HMRC has updated its guidance on Making Tax Digital (MTD) exemptions for averaging relief claims. The clarified guidance explains that partners who claim averaging relief on the SA104 partnership pages for the 2024–25 tax year will need to apply for an exemption from MTD.

Taxpayers who claim averaging relief for farmers, market gardeners or creative artists on the SA103 supplementary page of their 2024–25 Self Assessment return will be automatically exempt from MTD for the 2026–27 tax year.

HMRC has now clarified that the same automatic exemption doesn’t apply to partners who would otherwise need to use MTD (e.g. if they have personal trading or property income, outside the partnership) claiming averaging relief on the SA104 supplementary page in their 2024-25 tax return. They must apply for an exemption from MTD.

Taxpayers, whether they are sole traders or partners who would otherwise have to use MTD, who did not claim averaging relief in their 2024–25 return, but reasonably expect to do so in their 2025–26 or 2026–27 tax return will also need to apply for an MTD exemption on this basis until April 2027.

Read the updated guidance

 

Apply for an exemption

 

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