Quick answer: MTD for Income Tax is a phased rollout that pulls more of your client base into quarterly cadence each April: over 50,000 pounds from April 2026, over 30,000 pounds from April 2027, and over 20,000 pounds from April 2028, with limited companies outside the scheme. The later phases bring far more clients, often needing more support per head, so a firm that automates for the first phase is ready for the waves. CleanBooks AI’s free six-month pilot lets you validate the workflow on a real cohort now, then scale.
MTD for Income Tax is not a single event, it is a phased rollout that pulls more of your client base into quarterly cadence each April. For a firm, the timeline is effectively a countdown with three alarms. Knowing what each stage means, and what to do before it, is the difference between staying ahead and scrambling. Here is the timeline and the moves that match it.
The three thresholds
From 6 April 2026, sole traders and landlords with qualifying income over £50,000 must keep digital records and file quarterly. From April 2027 the threshold drops to £30,000, and from April 2028 to £20,000. Each step widens the affected population substantially, pulling hundreds of thousands more into scope and expanding the share of any firm’s book that is in cadence. Limited companies remain outside MTD for Income Tax.
For the full picture, see our complete Making Tax Digital guide and how qualifying income is calculated, or check who is eligible on GOV.UK.
What the £50,000 phase means now
Your highest-income sole traders and landlords are already in quarterly cadence. The immediate job is to have those clients on clean digital records and a working quarterly workflow, and to know exactly who is in this first tranche. Firms still treating these clients on an annual rhythm are already behind the requirement.
Preparing for the £30,000 and £20,000 waves
The later phases are where the volume really arrives. The clients pulled in at £30,000 and £20,000 are more numerous and often less financially sophisticated, needing more support per head. A firm that builds an automated, scalable workflow for the first phase is ready for these waves; one that hand-cranks the first phase will be overwhelmed by the later ones.
Why acting early wins
Each threshold is a deadline you cannot move, and setting up under deadline pressure is always harder and more error-prone than preparing ahead. Firms that automate before the wave arrives enter each phase with capacity to spare, and can even win clients from competitors who left it late. The clock rewards the prepared.
The move to make today
The lowest-risk preparation is to prove an automated workflow now, on your current first-phase clients, so it is ready to scale as the thresholds drop. CleanBooks AI’s free six-month pilot lets a firm do exactly that: build and validate the workflow on a real cohort today, then expand it across the waves of 2027 and 2028 with confidence rather than panic.
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