Now is the time to proactively register clients
September 2026 marks an important point in the rollout of Making Tax Digital (MTD) for Income Tax. Members should be taking proactive steps now to register eligible clients rather than waiting for HMRC to do it for them.
HMRC has confirmed that, from September 2026, it will start signing up taxpayers who are required to use MTD for Income Tax for the 2026/27 tax year but have not signed up themselves. However, agents have an important opportunity to act first and ensure that their clients' information is accurate and up to date.
Why proactive registration matters
There is a significant practical advantage in registering clients before HMRC does.
When a taxpayer or their agent signs up, they can check that the correct income sources and latest circumstances are included. If HMRC registers the taxpayer, it will use the information it already holds. That information may not reflect changes since the client's last self-assessment return.
For example, a client may have started or ceased a property business, changed their trading activities or added another source of self-employment income. HMRC's guidance specifically states that ceased self-employment and property income sources should be considered during registration. This ACCA article provides step-by-step guidance on how to register clients for MTD for ITSA.
What should accountants do now?
ACCA members should:
· consider undertaking a structured review of their client base
· identify affected clients who are required to use MTD for ITSA for 2026/27
- review clients' previous Self-Assessment returns
- check qualifying income
- review income sources and check that all self-employment and property businesses are correctly recorded, including any sources that have ceased
- check exemptions. Establish whether a client may be exempt from MTD for Income Tax before registering them
- confirm software readiness. Clients will need software compatible with MTD for Income Tax to maintain digital records and submit quarterly updates
- register clients
- communicate with clients. Explain what is changing, what information you need from them and what their ongoing responsibilities will be.
For the 2026/27 tax year, the threshold is based on total income from self-employment and property of more than £50,000 for tax year 2024/25, before expenses.
Registration is only the beginning
Accountants should not view registration as a one-off administrative exercise. MTD changes the way affected clients will maintain records and interact with HMRC.
Practices should therefore use the registration process as an opportunity to assess whether each client's bookkeeping systems, software and internal processes are ready.
There is also an important opportunity to improve client service. Regular digital information could allow accountants to provide more timely advice on cash flow, profitability, tax liabilities and business performance.
The qualifying-income threshold is scheduled to fall to £30,000 for 2027/28 and £20,000 for 2028/29, hence agents should be building a longer-term MTD strategy rather than treating 2026/27 as a one-off exercise.
Practitioners should also be aware that the new points-based penalty system for MTD for ITSA will kick-in from April 2027.
Useful resources
