MTD for Income Tax: What Salford Taxpayers Need to Know Before the Deadline

As the UK government advances its digital transformation of the tax system, Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is set to bring significant changes for many taxpayers. If you’re based in Salford or Swinton and are self-employed, a landlord, or a sole trader, it’s essential to understand how MTD will impact your tax reporting obligations—and how a trusted tax advisor in Salford like Cogency Chartered Accountants can support you.

Making Tax Digital (MTD) is an HMRC initiative aimed at making tax reporting more efficient and accurate. MTD for Income Tax will require affected individuals to maintain digital records and submit quarterly income tax updates using compatible software.

According to HMRC, MTD for ITSA is set to apply from April 2026 for individuals with annual gross income over £50,000, with those earning between £30,000 and £50,000 joining in April 2027.

You will be required to comply with MTD for Income Tax if:

• You are self-employed

• You are a landlord with rental income

• Your total annual gross income exceeds £50,000 (from April 2026)

• You are currently required to file a Self Assessment tax return

If you fall into one or more of these categories, it’s critical to start preparing early to avoid potential disruption or penalties.

1. Maintain digital records of your income and expenses
2. Use HMRC-approved software to submit quarterly updates
3. Submit an end-of-period statement (EOPS) and a final declaration annually

These updates replace the current once-a-year Self Assessment tax return and shift your tax obligations into a more real-time system. 

While the deadline may seem distant, the transition to digital compliance will take time. Businesses and individuals need to:

• Select the right cloud-based accounting software

• Train themselves or their staff on using digital systems

• Adjust their processes to accommodate quarterly filing

At Cogency Chartered Accountants, we provide tax advisory services in Salford and Swinton tailored to MTD readiness. Explore our tax services here

As experienced tax advisors in Salford, Cogency Chartered Accountants offers a comprehensive range of support for MTD for ITSA:

• Assessment of your eligibility and current record-keeping practices

• Guidance on selecting HMRC-recognised software

• Assistance with digital record-keeping and training

• Full-service support for quarterly updates and annual filings

• Ongoing tax advice to help optimise your financial position

We ensure your compliance without disrupting your business operations. Get in touch with our team

Here are essential steps Salford taxpayers should take to get ready for MTD:

1. Understand your obligations
   Check if your income meets the threshold and whether your current systems are MTD-compatible.
2. Choose the right software
   Opt for HMRC-approved software such as QuickBooks, Xero, or FreeAgent.
3. Start keeping digital records now
   Even before the deadline, transitioning to digital systems will make the adjustment smoother.
4. Schedule quarterly reviews
   Regular check-ins with your accountant help ensure all data is up to date and accurate.
5. Plan for the end-of-year declaration
   Unlike traditional returns, MTD requires a final declaration after quarterly updates.

For detailed guidance, refer to HMRC’s official page on Using Making Tax Digital for Income Tax.

Starting April 2025, penalties for late VAT payments will increase under HMRC’s updated penalty regime. If VAT remains unpaid:

• A 3% penalty will apply after 15 days

• An additional 3% applies if still unpaid after 30 days

• A daily penalty will accrue at 10% per annum from day 31 onwards

These changes are designed to encourage prompt payment and apply specifically to VAT and some participants in the Making Tax Digital (MTD) for Income Tax pilot.

Self-Assessment penalties, meanwhile, follow a different structure and remain unchanged for now. They include:

• A £100 fixed fine for late filing

• 5% of tax unpaid after 30 days, with further penalties after 6 and 12 months

At Cogency, we combine deep local knowledge with extensive expertise in UK tax compliance. Our tax services are designed to support individuals and businesses in Swinton and Salford through every stage of MTD implementation. We work with:

• Freelancers and sole traders

• Property landlords

• Construction and trades professionals

• Hospitality and retail businesses

• Healthcare and care providers

Explore our full Tax Services or visit our homepage for more insights.

Procrastination can lead to penalties, stress, and missed opportunities. By working with an experienced tax advisor now, you ensure that:

• Your records are accurate and digital-ready

• You have support for quarterly and annual submissions

• You understand your tax position and avoid overpaying

If you’re unsure about your obligations under MTD or need help choosing the right tools, our team is ready to assist. Reach out via our Contact page to book a free consultation.

MTD for Income Tax represents a major shift in how UK taxpayers manage their financial obligations. While the transition may seem daunting, proactive preparation with the right tax advisor can turn compliance into opportunity.

At Cogency Chartered Accountants, we offer professional, responsive, and personalised support to help you navigate this change confidently.

If you operate in Swinton, Salford, or the wider Manchester area, get in touch today to future-proof your tax compliance and protect your business from unnecessary risk.