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HMRC has rolled out a new online filing portal for tax advisors and accountants acting for landlords and the self-employed.
The latest part of the Making Tax Digital (MTD) program was switched on April 22 2024, to give software developers and tax agents the chance to work with live data before the system goes entirely online in April 2026.
The pilot service is for landlords and the self-employed, earning more than £25,000 annually.
HMRC has yet to tell tax advisers which clients are eligible for the trial, only saying that advisers must have an HMRC Agent Services Account and that clients must meet strict criteria.
To provide more scheme details, a live online Q&A session is scheduled for 2 pm on Friday, April 26.
Register here for the HMRC webinar.
Tax advisers and landlords taking part in the pilot need compatible software.
From April 2026, landlords earning rents of more than £50,000 a year must register with MTD ITSA.
HMRC demands that they keep digital accounting data, which they must file quarterly.
From April 2027, the MTD ITSA net widens to cover landlords earning £30,000 or more yearly.
An HMRC spokesman said: “Agents need to make sure both their and their client’s record-keeping software is compatible with Making Tax Digital before signing up. You can check compatible software options.
“If the software that you or your client prefer to use is not listed, you should contact the software provider to find out when they plan to join Making Tax Digital.”
ITSA—income tax and self-assessment—is the latest MTD segment to go live. VAT and payroll tax services opened some years ago.
Five software providers already have MTD ITSA products on the market, with many more with packages in development.
The latest lists of MTD ITSA software available now and under development are on the HMRC website.
MTD ITSA software must store business and expense income digitally, file quarterly updates with HMRC, make year-end declarations by January 31 as part of a self-assessment tax return and be capable of receiving data and messages from HMRC.
Landlords may keep records on spreadsheets but need bridging software to link with HMRC.
HMRC says MTD will help landlords get their tax right by improving the accuracy of their record-keeping.
At the end of the year, landlords and agents can adjust their income and expenses to finalise sending a declaration to HMRC. Any tax due for the year is due by midnight on January 31.
The quarterly reporting dates are the fifth of August, November, February and May.
MTD ITSA only impacts individual landlords or business partnerships.
Joining the service will mean extra accounting work for landlords who must file quarterly reports rather than leave accounting to the year-end.
The same filing dates will apply to the self-employed.
The qualifying rules for MTD have yet to be published, except landlords with rents of £50,000 a year must join from April 2026, and those with rents of £30,000 a year must join from April 2027.
HMRC is testing the MTD ITSA system for landlords with some tax advisers from April 2024, but the service does not become mandatory until April 2026 for landlords earning rents of £50,000 yearly.
Now is an excellent time to start digital bookkeeping, get used to the process, and resolve any problems or software glitches. Landlords can use specialist software packages or spreadsheets with bridging software that connects with HMRC.
HMRC will impose late filing penalties, but the full details for MTD ITSA are awaited.
MTD for corporation tax is on the way but has yet to be mandatory for companies. MTD ITSA is for landlords trading as individuals or partnerships.