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More taxpayers can test making tax digital

Author: ICAEW Insights

Published: 10 Feb 2025

Taxpayers liable to the high income child benefit charge (HICBC) or with income from jointly held property can join making tax digital for income tax (MTD income tax) testing for 2025/26. IRIS has also joined the list of software available for 2024/25.
Ahead of mandation from April 2026, HMRC is expanding the testing of MTD income tax for the 2025/26 tax year. Some eligibility restrictions continue to apply but two significant ones are being removed – HICBC and income from jointly held property. ICAEW has published the full list of eligibility criteria at Signing up for MTD.  
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What is Making Tax Digital for income tax?
The government is working to digitalise the tax system, and Making Tax Digital for income tax is a key part of this strategy. We explain the basics in a new video.

It is currently possible to sign up for 2024/25 or to start from 2025/26. From April 2025, the two options presented during sign up will be 2025/26 or 2026/27. 

Signing up for 2024/25 is the last opportunity before mandation to test the system through to the final tax return. This is most likely to be appropriate where digital records are already being maintained on a regular basis. During the testing period there are no penalties or penalty points for late submission of quarterly updates.  

Volunteers should be aware that the HMRC submission service allowing the reporting of other income not covered by MTD income tax requirements is currently closed and will remain so throughout 2025/26. It is not clear whether it will ever reopen for those in MTD income tax. This means that it is important to choose a product or products that will allow the completion of all necessary parts of the tax return and the finalisation of the income tax liability. 

IRIS Elements Cashbook and IRIS Kashflow have been added to HMRC’s list of software products currently available for tax year 2024/25. This brings the total number of software products to 13.  

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