Voluntary sign-up for MTD for ITSA: How and why you can opt in early

MTD for ITSA (Making Tax Digital for Income Tax Self Assessment) is the UK government’s initiative to modernise the tax system for sole trades (i.e., self-employed individuals who trade as sole trades) and landlords. It replaces annual paper or online returns with digital record-keeping, quarterly updates, and a final declaration through HMRC-approved software.

Right now, MTD for ITSA is open for voluntary sign-up, meaning you can join before it becomes mandatory in April 2026. Doing so gives you extra time to adapt, test compatible software, and build confidence in digital reporting.

What Is Voluntary Sign-Up for MTD ITSA & Why It Matters

Voluntary sign-up lets eligible taxpayers start using the MTD for ITSA (Making Tax Digital for Income Tax Self Assessment) system early. This means submitting quarterly income and expense updates digitally through compatible software, long before the legal obligation begins.

Why sign up early?

• Gain hands-on experience before April 2026

• Spread your learning curve across several months

• Identify any accounting or process issues early

• Get used to your chosen MTD software without penalty risk

Eligibility: Who Can Voluntarily Sign Up

According to HMRC, You can sign up voluntarily if all of the following apply:

• Your personal details are up to date with HMRC

• You’re a UK resident

• You have a National Insurance number

• You’ve submitted at least one Self Assessment tax return

• You’re up to date with your tax records (for example, you have no outstanding tax liabilities)

• Your accounting period runs from either:

 – 6 April to 5 April, or 1 April to 31 March – and your software supports this accounting period

You cannot volunteer if you are in a partnership, bankrupt, on a payment plan, or receive specific allowances like Blind Person’s or Married Couple’s Allowance.

How to Register Voluntarily for MTD ITSA

• Visit HMRC’s official “Sign Up for Making Tax Digital for Income Tax” page

• Confirm you meet the eligibility criteria and choose your accounting period

• Use MTD-compatible software (approved by HMRC)

• Authorise your software to link with your HMRC account

• If you have an accountant, they can complete this through their Agent Services Account

Once you’ve signed up, HMRC will confirm your enrolment and the start date for quarterly submissions.

Obligations During the Voluntary Period

If you volunteer, you must:

• Keep digital income and expense records

• Submit quarterly updates to HMRC

• File a final declaration confirming totals for the tax year

During the voluntary period, HMRC does not apply late-submission penalties for quarterly updates, though late payment or missing final declarations may still incur fines.

You can leave the pilot at any time if your circumstances change or you prefer to return to annual Self Assessment before 2026.

Key Risks and Considerations

• You still need to meet standard Self Assessment deadlines (31 January for final return and payment).

• Not all income types qualify for MTD ITSA yet (e.g. partnership, trust, or foreign income).

• HMRC can remove you from the voluntary scheme if you stop meeting eligibility rules.

• Once you cross the income threshold, participation becomes mandatory.

Practical Tips for Early Adopters

• Choose MTD-compatible software and connect it to HMRC well before April 2026

• Use sample or trial quarterly submissions to verify data accuracy

• Keep an audit trail of all digital transactions

• Stay updated with HMRC announcements about eligibility and deadlines

Conclusion

Voluntary sign-up for MTD for ITSA is the simplest way to future-proof your tax processes. It lets you build experience, identify gaps, and stay compliant before the rules become mandatory.

Join the EasyInvoice today and get early access, smart tools, and a smoother start to Making Tax Digital.