Tax admin for small businesses is changing more in the next three years than in the last thirty. None of it is optional, but all of it is manageable if you start early. Here is what is happening and when.

Making Tax Digital for Income Tax: now

Since 6 April 2026, self-employed people and landlords with qualifying income over £50,000 have had to keep digital records in compatible software and send HMRC a quarterly update. The first update was due on 7 August. HMRC says more than 436,000 people sent one, and more than 570,000 had signed up by mid-August. HMRC has also begun signing up people automatically if it believes they should be in the scheme.

The remaining deadlines for 2026/27 are:

• 7 November 2026: update covering 6 April to 5 October
• 7 February 2027: to 5 January
• 7 May 2027: to 5 April
• 31 January 2028: the final declaration for 2026/27, filed from your MTD software

There are no late-filing penalty points for quarterly updates in this first year. But every missing update must still be sent before you can file your final declaration. If you missed August, your November update covers the year so far, so you can catch up in one go.

Note that the old-style Self Assessment return for 2025/26 is still due on 31 January 2027 as normal.

April 2027: the £30,000 wave

From 6 April 2027, people with qualifying self-employment and property income over £30,000 in 2025/26 join MTD. That will bring in a large number of Havering’s tradespeople, consultants, therapists, tutors and buy-to-let landlords. The Budget confirmed they will get no late-filing penalties for their first four quarterly updates.

One piece of good news alongside it: the trading allowance triples to £3,000 from April 2027, so very small side incomes may drop out of Self Assessment altogether.

Further ahead: 2029

The Budget set out three changes for April 2029:

• Mandatory e-invoicing. All VAT invoices issued by VAT-registered businesses must be e-invoices, sent system to system through the Peppol network. A PDF attached to an email will not count. The government’s roadmap says detailed requirements will be published between October 2027 and April 2028, with testing and onboarding from April 2028. ICAS has warned this is a tight timetable for software providers and small firms.
• Payments on account. Self Assessment’s two big lump sums in January and July are being replaced with smaller, more frequent payments. HMRC will consult first.
• Direct Debit instructions for VAT and PAYE. Businesses will need one in place. You can still pay another way, but HMRC will use the instruction to collect anything unpaid by the deadline.

What it means in practice

The common thread is that HMRC wants to see your figures as you go, not once a year. For many small firms that is a cash-flow shift as much as an admin one. If you only look at your books in January, you will feel it.

The businesses that will cope best are the ones that already use cloud accounting software, reconcile their bank feed every week and talk to their accountant more than once a year.