HMRC Is Auto-Enrolling 294,000 Sole Traders and Landlords into MTD, What You Must Do Now
As of 21 September 2026, HMRC has started automatically enrolling around 294,000 sole traders and landlords into Making Tax Digital for Income Tax. This is an urgent compliance change for people with qualifying income above £50,000 who should have joined from April 2026 but have not registered themselves.
- HMRC is now enrolling eligible people in stages rather than waiting for them to sign up.
- You still need compatible software and a working digital record system.
- Four quarterly updates and a final declaration replace the previous annual only process.
- The threshold falls to £30,000 in April 2027 and £20,000 in April 2028.
What has changed?
MTD for Income Tax became mandatory in April 2026 for sole traders and landlords whose qualifying income exceeds £50,000. HMRC has now moved to auto enrolment for those who meet that test but did not join voluntarily. A notification from HMRC is not an optional invitation. It means you need to make sure your records, software and submission process are ready.
Software providers, including FreeAgent, have issued urgent guidance because a taxpayer cannot meet the new process with a spreadsheet alone. Compatible software connects to HMRC and sends the required updates. Our self employed MTD support can help you choose a practical route before a deadline is missed.
What you need to do now
Read any HMRC notice promptly, select compatible software, bring your income and expense records up to date, then confirm who will file each quarterly update. If bookkeeping has fallen behind, our bookkeeping service can get the routine work into a reliable digital process. For help selecting and setting up a suitable package, see our accounting software support.
Questions and answers
Who is HMRC auto-enrolling?
Sole traders and landlords with qualifying income above £50,000 who were required to use MTD from April 2026 but have not registered themselves are being enrolled in stages.
Does the HMRC notice mean I have already complied?
No. It confirms your MTD status, but you must still maintain digital records and use compatible software to send quarterly updates and the final declaration.
How often will I submit information?
You must submit four quarterly updates each year, followed by a final declaration. This is a different rhythm from preparing one annual Self Assessment return.
What happens if my income is under £50,000?
You may not be required yet, but plan ahead. The threshold is due to reduce to £30,000 in April 2027 and £20,000 in April 2028.
Can I use a spreadsheet?
A spreadsheet on its own will not submit to HMRC. It must work through compatible MTD software or an approved bridging solution that supports the required process.
What if I miss an update?
Late submissions can attract penalty points and, once the relevant threshold is reached, financial penalties. Act early rather than waiting for the first quarterly deadline.
We can review your position, software and record keeping, then help you move forward with confidence.
Book a conversation with 360 Accounts View our pricing360Accounts.net, Accountants for Small Businesses and Sole Traders, Guildford, Surrey