FIS is highlighting an important upcoming change to the UK tax system, with Making Tax Digital (MTD) for Income Tax set to come into force from 6 April 2026.
The update, highlighted by Build UK, represents a significant shift in how self-employed individuals manage and report their tax, forming part of HMRC’s wider programme to modernise the tax system and reduce errors.
What is Changing?
The new system will be introduced in phases over the next three years, beginning with individuals who have an annual turnover above £50,000.
Under the new requirements, affected individuals will need to:
- Use HMRC-recognised software to keep digital records of income and expenses
- Submit quarterly updates to HMRC via their chosen software
- Receive an estimated tax position based on submitted data
- Continue to pay a single annual tax bill, with the deadline remaining 31 January
Both free and paid software options are expected to be available, allowing individuals to select a system that suits their business needs.
What You Need to Do
Individuals who meet the criteria will need to:
- Check their eligibility for the new service
- Sign up in advance, as enrolment will not happen automatically
HMRC has published further guidance, including a series of frequently asked questions, to support businesses and individuals in preparing for the transition.
Why This Matters
This change will affect many self-employed individuals working across the finishes and interiors sector, particularly those operating as sole traders or subcontractors.
Early preparation will be key to ensuring a smooth transition to digital record keeping and reporting.
FIS encourages members to review the requirements and consider how the changes may impact their business processes.