HMRC letter · £30,000

Got an HMRC letter about Making Tax Digital and £30,000?

Last updated 28 October 2026. Every fact below is checked against the sources listed at the end. General information, not tax advice.

Short answer: If HMRC reviews your return and finds your income is above the relevant threshold, it will write to you confirming that you need to use MTD for Income Tax by the start of the next tax year. Even if you don't get a letter, you must still check your qualifying income yourself and sign up if you need to. If your 2025 to 2026 tax return shows qualifying income over £30,000, you need to use MTD for Income Tax from 6 April 2027. The figure HMRC looks at is your qualifying income: turnover before expenses, not profit and not payouts.

Check the figure HMRC used

Qualifying income is your total turnover from self-employment and property: the amount before expenses, taken from the tax return you submitted for the previous tax year. It can come from more than one source. Employment (PAYE) income, your share of partnership profit as an individual partner, dividends, the State Pension and private pensions don't count towards qualifying income. HMRC says turnover for the threshold includes gross income from self-employment and property before any tax allowances or expenses are deducted.

Marketplace sellers often see a payout total that's lower than turnover. See how it works for Etsy, eBay, Amazon and Shopify.

What to do before 6 April 2027

To sign up you must be registered for Self Assessment and have submitted a tax return in the last two years. Signing up early is allowed.
HMRC doesn't provide software. All products on its software finder have been through HMRC's recognition process. You can keep using spreadsheets for your records, but you'll need software that links to them (sometimes called bridging software) to send quarterly updates and your tax return.
With standard update periods you create digital records from 6 April; with calendar update periods, from 1 April.
Note the first deadline: update 1 for 2027 to 2028 is due by 7 August 2027 (all dates).

If you think it's wrong

If you amend a tax return before the start of a tax year and it takes qualifying income above or below the threshold, that decides whether you need MTD for the upcoming year. A change after the start of the year that takes you below the threshold means you don't need it for that year; a change that takes you above it isn't considered for that year. Some people are exempt from MTD for Income Tax, for example if they're digitally excluded. Exempt people still report income in a Self Assessment return as normal. If you're unsure, check with HMRC or an accountant rather than ignoring the letter.

Worked example: why a letter can surprise a seller

Example figures A sole trader's 2025 to 2026 return. Made-up figures for a fictional seller, not real data.

Line	Amount
Etsy turnover	£18,400.00
eBay turnover	£9,300.00
Rental income (a let flat)	£4,200.00
Qualifying income	£31,900.00
Platform fees (expenses, not deducted)	−£4,870.00

Fees bring profit down, but qualifying income is still £31,900, over £30,000, so MTD applies from 6 April 2027.

Turn your marketplace exports into MTD-ready records

TidyTill reads Etsy, eBay, Amazon, Shopify and PayPal exports, works out gross turnover, splits it into MTD periods and flags gaps and duplicates. Upload your exports and see your totals, quarters and Health Check free before you pay. Then £19 one-off for a workbook or £49 a year for unlimited workbooks. Paid workbook downloads open very soon; the free preview works now.

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Questions

I didn't get a letter. Am I safe?

Not necessarily. If HMRC reviews your return and finds your income is above the relevant threshold, it will write to you confirming that you need to use MTD for Income Tax by the start of the next tax year. Even if you don't get a letter, you must still check your qualifying income yourself and sign up if you need to.

How many people join in April 2027?

HMRC estimates around 1,077,000 more sole traders and landlords will need to use MTD for Income Tax from 6 April 2027, based on its analysis of 2024 to 2025 returns.

Is MTD a different tax?

Making Tax Digital for Income Tax is a new way for sole traders and landlords to do Self Assessment.

Sources

Work out your qualifying income for Making Tax Digital for Income Tax (GOV.UK, checked 28 October 2026)
Using Making Tax Digital for Income Tax for the first time (GOV.UK, checked 28 October 2026)
Sole traders and landlords earning more than £30,000 urged to act now (HMRC, 5 October 2026) (GOV.UK, checked 28 October 2026)
Choose the right software for Making Tax Digital for Income Tax (GOV.UK, checked 28 October 2026)
Find out if you can get an exemption from Making Tax Digital for Income Tax (GOV.UK, checked 28 October 2026)

TidyTill is a record-keeping aid only. This page is general information, not tax advice. TidyTill is not HMRC-recognised software and it doesn't submit anything to HMRC: you send quarterly updates and your tax return through HMRC-recognised software. Rules and dates can change, so check GOV.UK or ask an accountant about your own situation.