Making Tax Digital splits into two regimes, and only one of them touches your limited company. If your company is registered for VAT, it is already inside Making Tax Digital for VAT: HM Revenue & Customs (HMRC) signs up every newly VAT-registered business automatically unless it is exempt or has applied for exemption, and VAT records must be kept and VAT Returns submitted through compatible software (HMRC guidance, verified 14 September 2026). There is nothing to opt into and nothing to apply for.
Making Tax Digital for Income Tax is a different regime entirely. It applies to sole traders and landlords registered for Self Assessment whose qualifying income from self-employment or property passes a threshold — £50,000, then £30,000, then £20,000, phased in between April 2026 and April 2028. Your limited company is never the subject of that regime. The only route it reaches you is personally, through income you earn outside the company.
Does Making Tax Digital apply to limited companies?
Partly, and the part that matters depends entirely on VAT. Making Tax Digital is not one switch that flips for a business. It is a programme rolled out tax by tax, and the tax it has already reached is VAT.
So the honest answer splits in two. Your company is in Making Tax Digital if it is VAT registered — every VAT-registered business should now be signed up, per HMRC's Making Tax Digital for VAT collection (verified 14 September 2026). Your company is outside Making Tax Digital if it is not VAT registered, because Corporation Tax has not been brought into the programme.
And you, the director, sit in a separate box again. Making Tax Digital for Income Tax is aimed at sole traders and landlords registered for Self Assessment. Salary and dividends taken from your own company do not put you there. If you also trade on your own account or let property in your own name, that personal income is what gets measured — not the company's turnover.
That single distinction resolves most of the confusion. Company plus VAT equals MTD for VAT. Personal self-employment or rental income above the threshold equals MTD for Income Tax. Nothing crosses over.
If you are unsure which side of the VAT line your company sits on, that is a five-minute conversation rather than a research project.
What does MTD for VAT require from your company right now?
Three things, and they are less about filing and more about how the numbers get to HMRC in the first place.
First, registration is handled for you. HMRC signs up all new VAT-registered businesses to Making Tax Digital for VAT automatically, unless they are already exempt or have applied for exemption (HMRC, verified 14 September 2026). Directors who registered for VAT recently sometimes go hunting for an MTD enrolment step that no longer exists.
Second, your VAT records have to be kept digitally. Not a shoebox of receipts typed up once a quarter into a return — the records themselves live in software.
Third, VAT Returns are submitted using compatible software. HMRC's own wording is blunt: you should now keep VAT records and submit VAT Returns using compatible software. A manual entry on the HMRC portal is not the route any more.
Practically, that means the software decision is the whole job. Pick something that keeps the records and files the return in one place and the obligation takes care of itself. Bolt software onto a spreadsheet habit and you will feel it every quarter.
Worth checking alongside this: whether you are approaching the point when your company must register for VAT in the first place, and whether the VAT Flat Rate Scheme suits how your company trades. Both change the shape of your VAT life far more than the digital filing mechanics do.
Does MTD for Income Tax affect you as a director?
Only through what you do outside the company. HMRC sets out the MTD for Income Tax test plainly: you need to use the regime if you are a sole trader or a landlord registered for Self Assessment, you get income from self-employment or property, or both, and your qualifying income is more than the relevant threshold (HMRC, verified 14 September 2026).
Read that against a typical director's position. You run a limited company. You pay yourself a salary and take dividends. You file a Self Assessment return because of the dividends. None of that makes you a sole trader or a landlord, and salary and dividends are not self-employment or property income. The company, meanwhile, reports its profits on a CT600 Corporation Tax return, which sits outside Making Tax Digital altogether.
Now change one detail. Say you also let a flat in your own name, or you kept some freelance work running on your own account alongside the company. That income is yours personally, it goes through Self Assessment, and it is exactly the income HMRC measures against the thresholds. Cross the line for the relevant tax year and Making Tax Digital for Income Tax applies to you — to you, not to the company.
Two people, one desk, two different rulebooks. It is worth being precise about which hat you are wearing before you take advice, because a director and a sole trader with the same income get different answers.
Our free guide walks through how the director's personal position and the company's obligations sit side by side.
What are the phase-in dates and income thresholds for MTD for Income Tax?
The thresholds step down over three tax years, and each one is measured against a tax year that has already closed. Here is the schedule HMRC published (verified 14 September 2026).
Qualifying income over
In tax year
Must use MTD for Income Tax from
£50,000
2024 to 2025
6 April 2026 (already in force)
£30,000
2025 to 2026
6 April 2027
£20,000
2026 to 2027
6 April 2028
Qualifying income here means income from self-employment and property, or both. It is not company turnover, it is not your salary, and it has no connection to the VAT registration threshold, which is a separate figure for a separate regime.
The timing detail catches people out. The £30,000 band is tested on the 2025 to 2026 tax year, but the obligation starts on 6 April 2027. So the figure that decides your position is already in the past by the time the rule bites — which also means you can work out now, from returns you have already filed, whether April 2027 is your date.
Is MTD for Corporation Tax happening?
Corporation Tax has not been brought into Making Tax Digital, and we are not going to put a date on something HMRC has not confirmed. What we can say is what applies today: your company files its Corporation Tax return in the existing way, and the only Making Tax Digital obligation it carries is the VAT one, if it is VAT registered. HMRC's Making Tax Digital collection is the place any change would appear first.
Treat that as a reason to get the VAT side clean rather than a reason to wait. A company already keeping digital records for VAT is a company that would absorb any future extension without drama. It also makes the company's other filings and deadlines easier to hit, because the underlying bookkeeping is current instead of reconstructed.
If you would rather have someone look at your setup and tell you plainly which obligations are live today, that is what a first conversation is for.
Our accountancy support connects you with a partner accountant who handles VAT software and filing questions every day, so you are not choosing a system on guesswork.
What else do directors ask about Making Tax Digital?
Does my limited company need to sign up for Making Tax Digital for VAT?
No. HMRC signs up all new VAT-registered businesses automatically, unless they are already exempt or have applied for exemption (verified 14 September 2026).
My company is not VAT registered. Does Making Tax Digital apply?
Not at present. Making Tax Digital currently covers VAT, and Corporation Tax has not been brought into the programme.
I take salary and dividends from my company. Am I in MTD for Income Tax?
Not through that income. The regime applies to sole traders and landlords registered for Self Assessment with self-employment or property income above the relevant threshold.
Can I still file a VAT Return manually?
No. HMRC requires VAT records to be kept and VAT Returns submitted using compatible software.
Which figure decides my MTD for Income Tax start date?
Your qualifying income from self-employment and property in the tax year named in the table — 2024/25 for the £50,000 band, 2025/26 for £30,000 and 2026/27 for £20,000.
Does the company's turnover count towards my personal threshold?
No. Qualifying income is personal income from self-employment or property. Company turnover is a separate matter and belongs to the company.
Making Tax Digital splits into two regimes, and only one of them touches your limited company. If your company is registered for VAT, it is already inside Making Tax Digital for VAT: HM Revenue & Customs (HMRC) signs up every newly VAT-registered business automatically unless it is exempt or has applied for exemption, and VAT records must be kept and VAT Returns submitted through compatible software (HMRC guidance, verified 14 September 2026). There is nothing to opt into and nothing to apply for.
Making Tax Digital for Income Tax is a different regime entirely. It applies to sole traders and landlords registered for Self Assessment whose qualifying income from self-employment or property passes a threshold — £50,000, then £30,000, then £20,000, phased in between April 2026 and April 2028. Your limited company is never the subject of that regime. The only route it reaches you is personally, through income you earn outside the company.
Does Making Tax Digital apply to limited companies?
Partly, and the part that matters depends entirely on VAT. Making Tax Digital is not one switch that flips for a business. It is a programme rolled out tax by tax, and the tax it has already reached is VAT.
So the honest answer splits in two. Your company is in Making Tax Digital if it is VAT registered — every VAT-registered business should now be signed up, per HMRC's Making Tax Digital for VAT collection (verified 14 September 2026). Your company is outside Making Tax Digital if it is not VAT registered, because Corporation Tax has not been brought into the programme.
And you, the director, sit in a separate box again. Making Tax Digital for Income Tax is aimed at sole traders and landlords registered for Self Assessment. Salary and dividends taken from your own company do not put you there. If you also trade on your own account or let property in your own name, that personal income is what gets measured — not the company's turnover.
That single distinction resolves most of the confusion. Company plus VAT equals MTD for VAT. Personal self-employment or rental income above the threshold equals MTD for Income Tax. Nothing crosses over.
If you are unsure which side of the VAT line your company sits on, that is a five-minute conversation rather than a research project.
What does MTD for VAT require from your company right now?
Three things, and they are less about filing and more about how the numbers get to HMRC in the first place.
First, registration is handled for you. HMRC signs up all new VAT-registered businesses to Making Tax Digital for VAT automatically, unless they are already exempt or have applied for exemption (HMRC, verified 14 September 2026). Directors who registered for VAT recently sometimes go hunting for an MTD enrolment step that no longer exists.
Second, your VAT records have to be kept digitally. Not a shoebox of receipts typed up once a quarter into a return — the records themselves live in software.
Third, VAT Returns are submitted using compatible software. HMRC's own wording is blunt: you should now keep VAT records and submit VAT Returns using compatible software. A manual entry on the HMRC portal is not the route any more.
Practically, that means the software decision is the whole job. Pick something that keeps the records and files the return in one place and the obligation takes care of itself. Bolt software onto a spreadsheet habit and you will feel it every quarter.
Worth checking alongside this: whether you are approaching the point when your company must register for VAT in the first place, and whether the VAT Flat Rate Scheme suits how your company trades. Both change the shape of your VAT life far more than the digital filing mechanics do.
Does MTD for Income Tax affect you as a director?
Only through what you do outside the company. HMRC sets out the MTD for Income Tax test plainly: you need to use the regime if you are a sole trader or a landlord registered for Self Assessment, you get income from self-employment or property, or both, and your qualifying income is more than the relevant threshold (HMRC, verified 14 September 2026).
Read that against a typical director's position. You run a limited company. You pay yourself a salary and take dividends. You file a Self Assessment return because of the dividends. None of that makes you a sole trader or a landlord, and salary and dividends are not self-employment or property income. The company, meanwhile, reports its profits on a CT600 Corporation Tax return, which sits outside Making Tax Digital altogether.
Now change one detail. Say you also let a flat in your own name, or you kept some freelance work running on your own account alongside the company. That income is yours personally, it goes through Self Assessment, and it is exactly the income HMRC measures against the thresholds. Cross the line for the relevant tax year and Making Tax Digital for Income Tax applies to you — to you, not to the company.
Two people, one desk, two different rulebooks. It is worth being precise about which hat you are wearing before you take advice, because a director and a sole trader with the same income get different answers.
Our free guide walks through how the director's personal position and the company's obligations sit side by side.
What are the phase-in dates and income thresholds for MTD for Income Tax?
The thresholds step down over three tax years, and each one is measured against a tax year that has already closed. Here is the schedule HMRC published (verified 14 September 2026).
Qualifying income over
In tax year
Must use MTD for Income Tax from
£50,000
2024 to 2025
6 April 2026 (already in force)
£30,000
2025 to 2026
6 April 2027
£20,000
2026 to 2027
6 April 2028
Qualifying income here means income from self-employment and property, or both. It is not company turnover, it is not your salary, and it has no connection to the VAT registration threshold, which is a separate figure for a separate regime.
The timing detail catches people out. The £30,000 band is tested on the 2025 to 2026 tax year, but the obligation starts on 6 April 2027. So the figure that decides your position is already in the past by the time the rule bites — which also means you can work out now, from returns you have already filed, whether April 2027 is your date.
Is MTD for Corporation Tax happening?
Corporation Tax has not been brought into Making Tax Digital, and we are not going to put a date on something HMRC has not confirmed. What we can say is what applies today: your company files its Corporation Tax return in the existing way, and the only Making Tax Digital obligation it carries is the VAT one, if it is VAT registered. HMRC's Making Tax Digital collection is the place any change would appear first.
Treat that as a reason to get the VAT side clean rather than a reason to wait. A company already keeping digital records for VAT is a company that would absorb any future extension without drama. It also makes the company's other filings and deadlines easier to hit, because the underlying bookkeeping is current instead of reconstructed.
If you would rather have someone look at your setup and tell you plainly which obligations are live today, that is what a first conversation is for.
Our accountancy support connects you with a partner accountant who handles VAT software and filing questions every day, so you are not choosing a system on guesswork.
What else do directors ask about Making Tax Digital?
Does my limited company need to sign up for Making Tax Digital for VAT?
No. HMRC signs up all new VAT-registered businesses automatically, unless they are already exempt or have applied for exemption (verified 14 September 2026).
My company is not VAT registered. Does Making Tax Digital apply?
Not at present. Making Tax Digital currently covers VAT, and Corporation Tax has not been brought into the programme.
I take salary and dividends from my company. Am I in MTD for Income Tax?
Not through that income. The regime applies to sole traders and landlords registered for Self Assessment with self-employment or property income above the relevant threshold.
Can I still file a VAT Return manually?
No. HMRC requires VAT records to be kept and VAT Returns submitted using compatible software.
Which figure decides my MTD for Income Tax start date?
Your qualifying income from self-employment and property in the tax year named in the table — 2024/25 for the £50,000 band, 2025/26 for £30,000 and 2026/27 for £20,000.
Does the company's turnover count towards my personal threshold?
No. Qualifying income is personal income from self-employment or property. Company turnover is a separate matter and belongs to the company.
