Digital Self Assessment: key dates and common mistakes
HMRC's Digital Self Assessment service is being introduced in phases. We explain the key dates for landlords and sole traders, and the mistakes we see every year.
What is Digital Self Assessment?
HMRC is modernising Self Assessment. Under Digital Self Assessment (DSA), some individuals will need to keep digital records and file their returns using MTD-compatible software, rather than filling in the familiar online form.
The key dates
The rollout is phased, so which dates apply to you depends on what your income comes from:
- From the 2026/27 tax year — unincorporated landlords and self-employed individuals with gross income over £50,000 will need to follow MTD rules for income tax.
- From the 2027/28 tax year — the threshold drops to cover anyone with income above £30,000.
- From the 2028/29 tax year onwards — HMRC intends to extend MTD for income tax to the lowest-income group, with no minimum threshold announced yet.
If your income is below the current threshold, you can still choose to file digitally or use paper/agent services where available.
Mistakes we see every year
1. Missing the filing deadline
The 31 January deadline for online returns is unforgiving. Filing even a day late triggers an automatic penalty — and the penalty increases the longer the return is outstanding.
2. Getting the basis period wrong
If you’re self-employed, income taxed in a year is based on your accounting period, not the calendar year. Get this wrong and you could be taxed at the wrong time.
3. Forgetting expenses
Business expenses can be offset against your income — think of the costs of running your business: office, software, equipment, travel, and a proportion of home costs if you work from home. Keeping a full record of everything means you don’t miss legitimate deductions.
4. Recording private use as business
Claims must be for business use only. For example, if you use a car for both, only the business proportion is allowable. HMRC increasingly looks at these claims.
5. Not keeping digital records
If MTD applies to you, you’ll need to keep digital records from day one. You can’t retroactively recreate a compliant digital trail in the final week of January.
How we can help
We help landlords and sole traders move to compliant digital record keeping, file MTD returns accurately, and — most importantly — plan their tax so there are no surprises. If you’d like help getting ready for Digital Self Assessment, book a free consultation.
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