What counts as qualifying income for Making Tax Digital

General information, not tax advice. This site explains published HMRC rules in plain English. It is not personal tax advice and we are not affiliated with HMRC. Check with HMRC or a qualified accountant before you act. Figures were checked against gov.uk on 5 November 2026.

HMRC decides when you must use Making Tax Digital for Income Tax by looking at your qualifying income. In plain terms, that is your total gross self-employment and property income before expenses (turnover), usually taken from the Self Assessment return for the relevant year.

Primary source: Work out your qualifying income for Making Tax Digital for Income Tax (gov.uk, updated 11 September 2026; checked 5 November 2026). Thresholds and start dates sit on the eligibility page.

Worked example 1 — sole trader plus landlord

HMRC’s own example adds:

• £25,000 gross rental income
• £27,000 gross self-employment income

Total qualifying income = £52,000. That sits over the £50,000 bar for 2024 to 2025 income, which points to a start date of 6 April 2026 on the eligibility page.

Worked example 2 — joint property only

Two siblings jointly own a property that produces £50,000 of income and share it equally, with no self-employment. HMRC’s example gives each sibling qualifying income of £25,000 — only your share counts.

Worked example 3 — employee who also freelances

Imagine £40,000 PAYE salary and £12,000 gross freelance invoices in 2025 to 2026. The salary does not count toward qualifying income. The £12,000 freelance gross does. On those numbers alone you would be under the £30,000 bar for an April 2027 start — but always re-check with your full return and the gov.uk tool.

What usually does not count

According to the qualifying income guidance, these do not count toward the MTD total:

• employment income (PAYE)
• your share of profit from a partnership as an individual partner
• dividends (including from your own company)
• State Pension and private pensions

Other exclusions and special cases (basis period transition profits, certain care relief, REIT/PAIF income, and more) are listed on the same gov.uk page — read that page if any of those apply.

Ceased trades and short years

If one income source has stopped but another continues, ceased income that appeared on the return can still count. If all self-employment and property income ceased before 6 April 2026, gov.uk says you will not need Making Tax Digital for Income Tax. Short accounting periods for sole traders may be scaled up to a full year by HMRC; for property you may need to annualise yourself. Details: gov.uk.

Next step

Put your total into the free start-date checker, then read April 2027 or April 2028 if those years are relevant.

Last checked against gov.uk: 5 November 2026.