Latest updates to help firms prepare for making tax digital for income tax self assessment announced

Find out about the latest announcements to Making Tax Digital for Income Tax Self Assessment (MTD ITSA) and how to help your firm prepare.

Exemption for digitally excluded customers

Further details have been issued on how to apply for an exemption to the MTD ITSA requirements if a client is digitally excluded. This is where it’s not reasonable for them to use MTD ITSA compatible software to keep digital records or submit them to HMRC.

There are different reasons why this may apply and HMRC will consider all applications on a case-by-case basis, such as:

• Their age, health condition or disability stops them from using a computer, tablet or smartphone to keep digital records or submit them to HMRC.
• They are a practising member of a religious society or order whose beliefs are incompatible with using digital communications or keeping digital records, and they do not use a computer, tablet or smartphone for business and personal use.
• They cannot get internet access at their home or business because of their location, and cannot get access at a suitable alternative location.

If you think a client is digitally excluded (and you will not meet the requirements on their behalf) you can now apply for an exemption from MTD ITSA for them. HMRC will aim to process the application within 28 days of receiving it. 

If you have previously signed up clients for MTD ITSA and think they should have been considered digitally excluded because their circumstances have changed, you should apply for an exemption now.

MTD VAT exemptions

If a client was previously confirmed as exempt from sending VAT returns using MTD compatible software because they are digitally excluded, you should contact HMRC to confirm their status for MTD ITSA. Find out how to get an exemption for MTD ITSA, who to contact and what you will need to tell HMRC.

HMRC awareness letters

From November 2025, taxpayers who have submitted their 2024/25 tax return will start receiving letters from HMRC making them aware of MTD ITSA. 

These awareness letters will:

• Inform taxpayers that, based on the information they have submitted, they will need to use MTD ITSA from April 2026.
• Inform taxpayers of what they need to do to get ready.
• Include a QR code linking them to GOV.UK guidance.
• Advise taxpayers to contact their tax agent to discuss what they need to do. 

As a result, you may receive increased contact from your clients about this.

When finalising your clients 2024/25 tax return, if you are not already doing so, you should consider whether the client will fall within the mandatory registration requirements for MTD ITSA from April 2026 onwards. This is an ideal time to ensure that clients are made aware of their MTD ITSA position. While most of the focus is likely to be on making sure that clients who will fall under MTD ITSA are aware of the impact on them, given the wider MTD ITSA messaging campaign being undertaken by HMRC (see below), it’s probably as important to make sure that self-assessment clients who do not fall within the remit of MTD ITSA are clear about their position also.

Communication resources

HMRC have released a range of communications resources on their Frontify website which can be used to help you amplify the message to clients about the change. The range of resources include:

• Social media copy
• Social media assets
• Newsletter copy.

Tailored agent support from HMRC

Agents now have access to tailored support to help you and your clients prepare for MTD ITSA.

HMRC’s MTD Agent Engagement team is running interactive group sessions on Microsoft Teams to provide guidance and support. These sessions will give direct access to HMRC specialists in an interactive environment where you can discuss what’s changing and get your questions answered in real time.

You can register your interest through a simple online form using your agent services account (ASA). You will need to sign in with your Government Gateway user ID and password linked to your ASA to access the form.

If you still do not have an ASA, you can access the form by signing in with your online services for agents account. In this case, you will need to enter your contact details manually.

When completing the form, you will be asked to:

• Give permission to be contacted by HMRC by email.
• Indicate how many clients you expect to sign up for MTD for Income Tax (including those for testing).
• Express an interest in the type of support you need.

Once you have completed the form, the MTD Agent Engagement team will be in touch with relevant support options, including instructions for joining an interactive session.

Get ready for MTD step by step

You can find out more information about MTD ITSA and what you need to do to get ready by following HMRC’s MTD agent step by step guide and their agent toolkit.