Hundreds of thousands of sole traders and landlords across the UK, including in Renfrewshire, face new tax reporting rules from April 2026.
HM Revenue and Customs has warned that around 864,000 people must prepare for the launch of Making Tax Digital for Income Tax, which begins on 6th April 2026.
The changes apply to sole traders and landlords who earned more than £50,000 from self-employment or property during the 2024 to 2025 tax year.
Under the new system, people will need to keep digital records and send quarterly updates of their income and expenses to HMRC using approved software.
HMRC has stressed that these quarterly updates are not extra tax returns. A full tax return will still be required at the end of the year.
Those affected will still submit their tax return for the 2025 to 2026 tax year in the usual way by 31st January 2027. The first tax return under the new system, covering the 2026 to 2027 tax year, will be due by 31st January 2028.
HMRC says free software options are available and that support is being offered through online guidance, webinars and videos. People who cannot use digital tools can apply for an exemption.
Craig Ogilvie, HMRC’s Director of Making Tax Digital, said: “With two months to go until MTD for Income Tax launches, now is the time to act. A range of software is available and the system is straightforward and helps reduce errors. Thousands of volunteers have already used it successfully.
“This will make it easier for sole traders and landlords to stay on top of their tax affairs and help ensure everyone pays the right amount of tax.
“Spreading your tax admin throughout the year means avoiding that last minute scramble to complete a tax return every January. Go to GOV.UK and start preparing today.”
HMRC said more than 12,000 quarterly updates have already been submitted through a voluntary testing programme.
To ease the transition, no penalty points will be issued for late quarterly updates during the first 12 months of the scheme. After that, a £200 penalty will only apply once four late submissions have been recorded.
Further phases will follow, with those earning more than £30,000 joining in April 2027 and those earning more than £20,000 joining in April 2028.
HMRC is urging anyone affected in Renfrewshire to check the guidance, choose suitable software and sign up through www.gov.uk.