Sarah Bradford highlights the penalty regime applying under making tax digital.
Making tax digital for income tax self-assessment (MTD for ITSA) will become a reality for self-employed traders and unincorporated landlords with combined trading and property income of £50,000 or more (based on 2024/25 figures) from 6 April 2026. It will be extended to traders and landlords with combined trading and property income of £30,000 from 6 April 2027 and to those with combined trading and property income of £20,000 from 6 April 2028.
Across the UK tax system, penalties apply if returns are submitted late and tax is paid late, and MTD is no exception. A penalty regime for MTD was introduced by Finance Act 2021. The penalty regime already applies for VAT purposes, and has done so since 1 January 2023. As regards MTD for ITSA, the regime
