Contractor Calculator
MTD Readiness Checker
Making Tax Digital for Income Tax launches in phases from April 2026. Enter your business type and income below to find out which phase applies to you, when you need to start filing quarterly, and what software you need.
What best describes your situation?
Gross turnover before expenses — not profit
Total rental income before expenses
How is this evaluated?
This checker compares your total qualifying income (gross self-employment income plus gross property income) against the MTD ITSA phase thresholds set by HMRC.
The thresholds are based on gross income (turnover), not profit. This means your total income before deducting any business expenses. If you have both self-employment and property income, they are combined.
Limited company profits, employment salary, dividends, pensions, and savings interest are not included in the qualifying income calculation. Only self-employment and property income count.
The phase dates and thresholds are confirmed by HMRC: Phase 1 from 6 April 2026 (over £50,000), Phase 2 from 6 April 2027 (over £30,000), and Phase 3 from 6 April 2028 (over £20,000).
Use our Compare Structures calculator to see how different employment structures affect your take-home pay, or check your IR35 status if you work through a limited company.
Automate your contractor accounting
Want to track MTD-compatible record keeping automatically? These tools handle UK contractor accounting, tax returns, and invoicing:
Frequently Asked Questions
What is Making Tax Digital for Income Tax?
Making Tax Digital for Income Tax Self Assessment (MTD ITSA) is HMRC's programme requiring self-employed individuals and landlords to keep digital records and submit quarterly updates to HMRC using compatible software. It replaces the annual Self Assessment tax return with more frequent digital reporting.
Who needs to sign up for MTD ITSA?
MTD ITSA is being rolled out in phases based on gross qualifying income (self-employment plus property income combined). Phase 1 (April 2026) covers those earning over £50,000. Phase 2 (April 2027) extends to those over £30,000. Phase 3 (April 2028) covers those over £20,000. Those earning below £20,000 are currently exempt.
How is qualifying income calculated for MTD?
Qualifying income is the total of your gross self-employment income and gross property income (rental income) before expenses. It is not your profit — it is your turnover. Limited company profits, employment salary, dividends, and investment income do not count towards the MTD threshold.
What software do I need for MTD?
You need HMRC-recognised MTD-compatible software to keep digital records and file quarterly updates. Popular options include FreeAgent, Xero, and QuickBooks — all of which support MTD for Income Tax. HMRC maintains a list of compatible software on GOV.UK.
What are the MTD quarterly filing deadlines?
You must submit quarterly updates by: 7 July (for the quarter ending 5 July), 7 October (for the quarter ending 5 October), 7 January (for the quarter ending 5 January), and 7 April (for the quarter ending 5 April). You must also submit an End of Period Statement by 31 January following the end of the tax year.
Are limited company directors affected by MTD ITSA?
Limited company profits are not subject to MTD for Income Tax. However, if you are a company director who also has personal self-employment income (e.g., a side business) or property rental income above the threshold, that personal income is subject to MTD. Your company director salary and dividends do not count.
These calculations are estimates based on current published tax rates. They do not constitute financial, tax, or legal advice. Always consult a qualified accountant for your specific situation.
Tax rates sourced from HMRC published rates for the 2026/27 tax year. Last verified: March 2026.