Blog · 3 November 2026

MTD April 2028: what the £20,000 wave means for sole traders and landlords

The third and largest wave of Making Tax Digital for Income Tax arrives on 6 April 2028, when the threshold falls to £20,000. GOV.UK's impact note puts around 970,000 additional sole traders and landlords in scope. The catch that trips people up: whether you join in April 2028 is decided by income you have already earned — your 2026/27 tax return, filed by 31 January 2028 — not by what you earn in 2028 itself.

Who joins in April 2028?

You must use MTD for Income Tax from 6 April 2028 if you are a sole trader or landlord registered for Self Assessment and your qualifying income for the 2026/27 tax year was over £20,000. The rollout so far:

HMRC reviews your Self Assessment return and writes to confirm you must start by the following tax year — but do not wait for the letter to start preparing. If you are not sure which wave you fall in, run your figures through the Making Tax Digital checker — it works out your start date from the same thresholds. The middle wave is covered in MTD April 2027: what the £30,000 wave means.

The 2026/27 trap: last year's figures decide

The qualifying year for the 2028 wave is 2026/27 — the tax year that ended on 5 April 2027, whose return is due by 31 January 2028. Three consequences follow. First, a strong 2026/27 pulls you into MTD even if 2027/28 income falls: the test looks backwards, not at your current year. Second, if your 2026/27 qualifying income was £20,000 or less, you are not mandated in April 2028 — the rule is over £20,000, so exactly £20,000 does not trigger it. Third, the decision is already made for most people reading this: if you filed a 2026/27 return showing over £20,000 of qualifying income, April 2028 is your start date whether or not you have heard from HMRC yet.

What counts toward the £20,000?

Qualifying income is your gross income from self-employment and property combined, before expenses. It is turnover, not profit — and the two sources add together, which is exactly how smaller traders and landlords get caught by a threshold that looks comfortably above either income on its own. Employment income taxed through PAYE, pensions, dividends and savings income do not count.

Example 1 — caught by combining. A part-time sole trader with £12,000 of turnover and £9,000 of gross rents in 2026/27 has qualifying income of £21,000 — over £20,000, so MTD starts on 6 April 2028, even though neither income alone crosses the threshold.

Example 2 — not caught. A landlord with £19,500 of gross rents in 2026/27 and no self-employment income is below the threshold, so she stays on the annual Self Assessment return for now. If a later tax year's qualifying income crosses a threshold in force then, that year's wave pulls her in. The landlord's full annual cycle is explained in MTD for landlords: quarterly updates, end-of-period statements and the final declaration.

Who is NOT in the April 2028 wave?

• Limited companies — MTD for Income Tax covers individuals only; companies fall under Corporation Tax rules.
• Partnerships — not yet in scope; GOV.UK says a timeline will be set out later.
• Qualifying income of £20,000 or less in 2026/27 — below (or exactly at) the threshold, so not mandated in this wave.
• People who are digitally excluded — GOV.UK provides an exemptions process for those who genuinely cannot use MTD; it must be applied for, not assumed.

Your first MTD year: the 2028/29 deadlines

From 6 April 2028 you keep digital records and send four quarterly updates through compatible software, followed by an end-of-period statement and a final declaration. The standard deadlines for your first year:

Note the overlap in January 2029: your Self Assessment return for 2027/28 — the tax year before you start MTD — is still due by 31 January 2029, while your MTD quarterly updates for 2028/29 are already running. See every wave's dates on the MTD deadline calendar.

No grace year this time — points count from the first miss

The first wave got a grace year: no penalty points for late quarterly updates in 2026/27. That grace does not extend to later waves. For the 2028 wave, a missed quarterly update from 2028/29 earns a penalty point, and four points trigger a £200 charge, as explained in MTD penalty points explained. Test what a missed deadline would cost on the penalty estimator. With no grace year, the cost of a slow start in April 2028 is real from day one.

What to do now (you have over a year)

1. Confirm your wave — add up gross self-employment and property income for 2026/27, before expenses, and check it on the MTD checker.
2. Choose compatible software early — from HMRC's recognised list, or a spreadsheet linked digitally to bridging software; paper records will not meet the requirement.
3. Start digital records during 2027 — so April 2028 is a switch-over, not a scramble. You can also sign up voluntarily before your mandatory date.
4. Diary the four update deadlines (7 August, 7 November, 7 February, 7 May) plus the 31 January 2030 final declaration — see the deadline calendar.
5. Sign up before 6 April 2028 (or have your agent do it) — you must be registered for Self Assessment and have filed a return in the last two years to sign up.

Sources

• GOV.UK — Find out if and when you need to use Making Tax Digital for Income Tax (waves and thresholds; HMRC confirmation letter; partnerships timeline to follow)
• GOV.UK — Reduction of the mandation threshold from £30,000 to £20,000 from April 2028 (Spring Statement 2025 announcement; effect from 6 April 2028; around 970,000 additional individuals)
• GOV.UK — Work out your qualifying income for Making Tax Digital for Income Tax (gross self-employment + property before expenses; PAYE, dividends and pensions excluded)
• GOV.UK — Quarterly updates: periods and deadlines (7 August / 7 November / 7 February / 7 May)
• GOV.UK — Penalties for Making Tax Digital for Income Tax (2026/27 grace year only; points from 2027/28; £200 at 4 points)

Free information tool — not tax advice. Figures follow GOV.UK guidance as checked on 3 November 2026. Confirm your own position with HMRC or an accountant.