MTD from April 2027: does the next threshold step catch you?

Priya is fictional, but her situation will be familiar to a lot of landlords who watched the first MTD wave arrive and pass them by. She has two buy-to-lets, and her gross rent sits well above £30,000 a year without coming anywhere near £50,000, the figure the mandate has used so far. That gap is exactly why she has treated MTD as someone else’s problem. It will not stay that way once the threshold moves again.

Whether the 6 April 2027 step catches you

The mandation timeline widens in steps rather than in one move. £50,000 is the figure that already applies, and 6 April 2027 is when it drops to £30,000. Anyone whose gross property and self-employment income sits over that new figure, but who was under the higher one already in force, joins MTD for Income Tax from that date rather than being caught by the current wave.

The income HMRC looks at for this step is your qualifying income for the 2025/26 tax year, so it is the return for that year that decides whether the 6 April 2027 step applies to you.

The test itself does not change between steps, only the figure it is measured against. The main MTD guide covers how the wider eligibility rules work; this guide is about what changes specifically for the cohort the 6 April 2027 step brings in. The Am I in MTD? calculator can take your own figures and say which step, if any, applies to you.

If your figures come out under £30,000, you are not necessarily clear of MTD altogether. The guide to the following threshold step covers the cohort the mandate catches after this one.

What counts as qualifying income

The figures above are tested against gross income, not profit, and only certain income counts towards it. Rent from UK property (and, for a UK resident, overseas property) and self-employment turnover are added together before any costs come off; salary, dividends, pension income and savings interest are not part of the test at all. The detail of what is included and excluded, including how jointly-owned property is treated, is covered fully in GOV.UK’s qualifying income guidance rather than restated here, since it is the version HMRC keeps current.

When your first quarterly updates fall

If the 6 April 2027 step is the one that brings you in, your first MTD tax year is 2027/28. These are the standard update periods for that tax year; if your software instead uses calendar quarters, the due dates stay the same but the periods shift slightly, and the deadlines calendar lays out both side by side.

The first quarterly update guide walks through what one of these updates actually needs to contain. What happens if a deadline slips, including any concession running at the time, sits in the penalties guide rather than here.

What to do before 6 April 2027 arrives

The months before your own step arrives are the calmest time to sort the practical side out, precisely because there is no live deadline pressure yet. Choosing MTD-compatible software, or a spreadsheet linked through compatible bridging software, tends to go better before the pressure sets in. The software selector narrows the tracked products to the ones that fit your property count, income mix and budget, and the comparison table is there if you would rather look at the full set side by side.

Moving to digital records is worth starting early too, since it is the habit that quarterly updates depend on rather than something that can be assembled retrospectively from a shoebox of paperwork. GOV.UK’s guidance on creating digital records sets out what counts and what the required digital links look like once information moves between one piece of software and another.

Where the calculator and reminders help

The threshold calculator is the fastest way to check your own figures against every step in the timeline, not just the one already live. Once it places you in this step, it can also point you towards a reminder for your own first quarterly deadline, and the deadlines calendar keeps the same dates available alongside every other tax year in the mandate, so nothing depends on remembering a single date correctly.

Questions people ask about the 6 April 2027 step

How do I know if the 6 April 2027 step applies to me, rather than the one already live or the one after it?

You are in this step if your combined gross property and self-employment income is over £30,000 but at or below £50,000. If you are already over £50,000, you are likely mandated already; if you are under £30,000, the step that follows in 2028 is the one to watch instead. Am I in MTD? calculator can check your own figures.

Does qualifying income mean my rental profit, after costs?

It means gross income, before costs such as letting agent fees, mortgage interest or repairs are deducted. Only the income side of the calculation counts for the threshold test, not what is left once expenses come off it.

When is my first quarterly update due once this step brings me in?

Your first MTD tax year would be 2027/28. On the standard quarterly system, its first update covers the opening months of that tax year and is due by 7 August 2027.

What should I do before the 6 April 2027 step arrives?

Start moving your records into MTD-compatible software, or into a spreadsheet linked through compatible bridging software, well before the deadline. Choosing while there is no live deadline pressure tends to produce a calmer decision than choosing in a rush afterwards.