Sign Up for MTD for Income Tax Before Connecting Software

Two Separate Steps: Signing Up With HMRC and Connecting Your Software

Signing up is something you do with HMRC, on GOV.UK. It tells HMRC that you will report your self-employment or property income through Making Tax Digital for Income Tax, and from which tax year.

Connecting is something you do in your software. You sign in with your Government Gateway user ID and password and give the software permission to talk to HMRC for you. HMRC's guidance on authorising software says to "Enter the user ID and password you used when you signed up for Making Tax Digital for Income Tax", which only works if the sign-up came first.

The trap is that the connection works either way. Government Gateway lets you authorise software whether or not you are signed up, so nothing looks wrong until the software asks HMRC for your business details and is refused. As the glossary entry on signing up puts it: connecting FileThat to HMRC with your Government Gateway login does not sign you up.

Check You Are in Scope First

You must use Making Tax Digital for Income Tax from 6 April 2026 if your qualifying income was over £50,000 in the 2024 to 2025 tax year. Qualifying income is your total income from self-employment and property before expenses, taken from the tax return you sent for that year. The threshold falls to £30,000 from 6 April 2027 and to £20,000 from 6 April 2028.

If you are not sure which side of the line you are on, the MTD checker works it out in about a minute, and the April 2026 guide covers the first year in detail.

Who Can Sign Up

GOV.UK gives two conditions. You must "be registered for Self Assessment" and "have submitted a tax return in the last 2 years". The service is for sole traders and for people with income from UK or foreign property.

You do not have to wait until you are required to. GOV.UK says you can sign up voluntarily "for the current tax year or the next one", so someone due to start on 6 April 2027 can join now and get used to it. If you have an accountant, GOV.UK says "they can sign you up instead".

New to self-employment, with no tax return sent yet? Then the second condition is not met yet, and HMRC checks that you are eligible when you sign up. GOV.UK describes no way round it. Register for Self Assessment and send your first return in the usual way; whether and when you must use Making Tax Digital is worked out from the income on a return you have sent. If you want to start sooner than that, ask HMRC.

What to Have Ready

The same Government Gateway user ID and password you got when you registered for Self Assessment. Do not create a second account for this: the sign-up has to sit on the account HMRC already knows you by.

Your business start date, or the date you started receiving property income, if that was within the last 2 tax years, and the tax year you want to start from. A sole trader also needs the business name as it appears on invoices, the business address and the trade.

GOV.UK also asks you to have software that works with Making Tax Digital for Income Tax before you sign up. Choosing it and creating your account is fine at this stage; it is the connection to HMRC that waits. You may be asked to prove who you are, using an app on your phone with your passport or driving licence.

How to Sign Up on GOV.UK

Open "Sign up for Making Tax Digital for Income Tax" on GOV.UK (the link is in the sources at the foot of this page), press Sign up now, and sign in with your Self Assessment details.

The service asks about your self-employment and property income only. Check each income source it lists, add any that are missing, and tell it about any that have stopped since your last return. It does not ask about other income such as employment or savings. That goes into your software later, before you submit your tax return.

HMRC checks that you are eligible from the details you give. There is nothing to download and nothing to pay.

How Long It Takes and How to Check It Worked

GOV.UK does not give a processing time, so do not plan around a figure you have read elsewhere. Check instead.

Sign in to HMRC online services with your Self Assessment details and look for "Making Tax Digital for Income Tax". If it is there, you are signed up. If it is not, GOV.UK says you can add it yourself: choose "Add a tax to your account", select Making Tax Digital for Income Tax and answer the security questions.

Once it shows, connect your software.

Then Connect FileThat

In FileThat you add your National Insurance number, then choose to connect to HMRC. You sign in on HMRC's own pages with the same Government Gateway details and give FileThat permission. HMRC asks you to repeat this every 18 months, and FileThat tells you when that date is coming.

FileThat then asks HMRC for your business details, which is how it learns which businesses to file for. This is the step that fails if you are not signed up. Once it succeeds you are ready for your first update, and the guide to what a quarterly update is and what the tax return adds explains what you will be sending.

When it fails, HMRC's own answer is "The client or agent is not authorised". FileThat does not leave you with that sentence. It tells you that HMRC says the Government Gateway account you connected is not signed up for Making Tax Digital for Income Tax under this National Insurance number, and asks you to check the number is yours. If it is, sign up on GOV.UK, then come back and press Try again. Nothing you have entered is lost. The help page on HMRC not recognising the account lists what to check.

The same refusal appears if the National Insurance number has a typing mistake, or if you signed in with a different Government Gateway account from the one you signed up with. Check those two before you try to sign up a second time.

If HMRC Has Signed You Up Already

From September 2026 HMRC has been signing up people who need to use Making Tax Digital for Income Tax for 2026 to 2027 and have not done it themselves. It is doing this in stages and writing to each person afterwards. If you have had that letter, you do not sign up again. The guide for people HMRC has signed up takes the steps one at a time.

GOV.UK's steps are: sign in to HMRC online services and select Making Tax Digital for Income Tax; "Check and confirm the records HMRC has are correct", because HMRC used only the information it already held; get compatible software; then "catch up and create digital records from the start of the tax year" and send your overdue quarterly update as soon as possible.

HMRC is not applying penalty points for late quarterly updates in 2026 to 2027 to people who had to start on 6 April 2026, so a quarterly update you send late this year carries no points. Late tax returns and late payments are still penalised. Each update covers the tax year so far, so the next one you send brings everything up to date. The dates are on the MTD deadlines page.

Accountants: Signing a Client Up

An agent signs a client up through a different GOV.UK service, with the client's permission. You need an agent services account, and the client must have authorised you for Making Tax Digital for Income Tax. An existing Self Assessment authorisation is recognised, but check that it has been added to your agent services account.

The same two conditions apply to the client: registered for Self Assessment, and a tax return sent in the last 2 years. If FileThat is refused for a client, either they are not signed up yet or they have not authorised you. See how FileThat works for accountants and the client onboarding guide for the rest.