HMRC has confirmed it will begin automatically signing up sole traders and landlords into Making Tax Digital for Income Tax from September 2026, targeting the roughly 294,000 taxpayers who should already be in the system but haven’t registered.
It’s the first time HMRC has announced it will enrol taxpayers itself — the MTD “no-shows” as they’re being unaffectionately called — rather than leaving registration to them.
How many UK sole traders and landlords filed MTD on time?
Just 436,000 — only around half of those required to comply — met the August 7th 2026 deadline for Making Tax Digital for Income Tax Self-Assessment (MTD ITSA). So perhaps something had to be done.
You wouldn’t get that impression from HMRC’s own upbeat press release on this first MTD ITSA milestone, though.
HMRC knew MTD adoption was lagging months before acting
A roughly 50% on-time filing rate, if you will, won’t be a surprise to anyone who was in the room five months ago. In March 2026, at the Finance, Accounting & Bookkeeping (FAB) show at the NEC, HMRC’s own team had grim reading for the audience. I recall a figure being put at somewhere between 800,000 and 900,000 taxpayers due to enrol for the current tax year, but with fewer than 9% having actually signed up to MTD by that point.
It was a pointed message from HMRC (never mind that it’s not one you’d find in an HMRC press release), aimed at rallying us accountants into getting the remaining sole traders and landlords on our books ‘over the line.’
Strength in numbers
My recollection of that March event isn’t the only account of that downbeat mood and poor MTD ITSA adoption. At the time, an accountancy trade mag reported a separate HMRC speaker — at the same FAB show — citing a comparable figure. Notably, signups to MTD ITSA were said to be running at just under 10%. Whichever number you take (< 9% or sub-10%), the unvarnished message from HMRC’s own team, delivered to a room full of advisers whom HMRC clearly needed to do some ‘hearts and minds,’ was that adoption wasn’t where it wanted. Less ‘FAB,’ more ‘DRAB,’ perhaps.
How many sole traders and landlords joined MTD voluntarily?
HMRC’s March plea-cum-warning has now materialised into action. Potentially not over the moon about:
- 570,000 sole traders and landlords signing up to MTD ITSA voluntarily
- 436,000 filing their first quarterly MTD ITSA update on time
…HMRC has said the remaining 294,000 taxpayers will be pushed over the line by the tax authority itself.
Will HMRC automatically enrol me in MTD ITSA?
Yes, if you’re a sole trader or landlord with combined gross income over £50,000 from self-employment and property for 2026/27, HMRC can now sign you up itself, rather than waiting for you to register.
Be in no doubt: this represents a reversal of how MTD has worked since April 2026, when registration was the taxpayer’s own responsibility. HMRC will begin registering those required to use the Making Tax Digital system in stages over the coming months, although late first quarterly updates won’t attract HMRC penalties this tax year.
Far from unprecedented
I’ll be honest: this shift has been a long time coming.
Years of consultations, HMRC letters, national advertising and constant reminders from software providers, and yes, us accountants too, have all led to the same conversation, over and over, with clients only discovering the rules apply to them when it’s almost too late.
HMRC clearly reached the same conclusion — that awareness campaigns alone weren’t going to close the gap.
What happens after HMRC signs me up automatically?
HMRC plans to issue instructions in late August 2026 for taxpayers being enrolled, setting out in official MTD ITSA guidance what to do once you receive a letter about being signed up.
Being enrolled by HMRC doesn’t finish the job for you, though — you’ll still need:
- MTD-compatible software connected
- Digital records
- Quarterly updates filed from that point
Is MTD ITSA actually worth it for landlords and sole traders?
That depends heavily on who you ask, and honestly, on how you already work. If you’re already using cloud accounting software, quarterly digital reporting tends to feel like a natural next step — better accuracy, fewer year-end surprises, and a clearer real-time picture for cash flow and planning.
For someone who’s managed their tax affairs perfectly well for decades on a spreadsheet or with one annual conversation with their accountant, it understandably feels like extra cost and admin for limited visible benefit — particularly for a landlord with a single rental property or a tradesperson who just wants straightforward bookkeeping.
Neither view is wrong. The honest answer is that MTD suits some business profiles far better than others, and the discomfort many taxpayers feel isn’t really resistance to digital record-keeping — it’s a fair question about whether the compliance burden matches the benefit for their specific circumstances. And it’s hard to see that discomfort easing, what with HMRC’s vow to automatically sign up individuals who should be on MTD ITSA.
Integro Accounting’s final thought: sensible administration, or a warning sign missed?
Is HMRC’s move to auto-enrol sensible administration, or a belated acknowledgement that MTD for Income Tax awareness was always going to fall short? Having sat in that room in March — and having spent years fielding the same ‘I didn’t know this applied to me’ conversation with the hundreds of sole traders and landlords we now support through MTD — I’d say it’s both, but mostly the latter.
HMRC did the outreach, right down to warning the accounting profession itself that adoption was lagging. It simply wasn’t going to reach everyone in time through letters and advertising alone, and auto-enrolment was always the logical backstop once that became clear.
MTD ITSA as Q4 2026 looms: We are where we are
What matters now isn’t the rights and wrongs of how we got here — it’s that MTD ITSA is mandatory, live, and HMRC is actively moving to bring in the people who haven’t engaged. If you haven’t reviewed your position, now’s the time, before HMRC does it for you.
Read our full guide to MTD for sole traders and landlords here.
For landlords and sole trader individuals with £50k+ turnover for 2026/27, the key is to understand the MTD ITSA rules and review existing record-keeping processes. Still unsure? Seek professional advice from an accountant who’s been in the room from the start.
