Making Tax Digital (MTD) exemptions may be automatic, temporary, or available through an application, depending on your circumstances. There have been recent changes to MTD for Income Tax from 6 April 2026 for sole traders and landlords with a qualifying income of £50,000. The new rules have left many individuals confused about whether they apply to them and if they’re exempt.
To learn more about the current MTD exemptions, who is exempt, and how to apply for exemption via HMRC, continue reading.
Who is Exempt From Making Tax Digital?
MTD exemptions are often given automatically, temporarily, or applied for.
Automatic Exemptions
You’re automatically exempt from MTD for an unlimited period if:
- You don’t have a National Insurance number
- You are a foster carer or shared lives carer whose only income is qualifying care receipts
- You are subject to a power of attorney
- You are a trustee submitting a tax return for a trust
- You are an executor managing a deceased person’s tax affairs
- You are a Lloyd’s underwriter with no other source of qualifying income
Temporary Exemptions
You’re temporarily exempt from MTD if:
- You have claimed averaging relief
- You have claimed qualifying relief
- You have received income from trusts or estates
- You have claimed either Married Couple’s Allowance or Blind Person’s Allowance
Applied-For Exemptions
You can apply to be exempt from MTD if:
- You have minimal digital literacy
- You have a disability
- You have poor mobile or internet access
- You hold a religious belief
Key Making Tax Digital Exemptions
If you’re unable to use digital tools due to disability, location, or religion, HMRC may consider these factors. They will decide whether it’s reasonably practicable for you to keep digital records and submit timely updates by taking your personal circumstances into account.
Disability
Having a physical or mental health condition may support an MTD exemption if it makes it unreasonable for you to use digital tools, keep digital records, and submit reports on time, even with help from close family or friends.
Location
If you reside in an area that has very poor internet access, you may potentially be granted an exemption from using MTD. Living in certain areas, such as isolated or remote locations, may mean you don’t have the high-speed and reliable internet required to comply with MTD.
Religion
Some individuals and religions may be exempt from using MTD if their beliefs forbid the use of electronic devices or internet access. These may include groups of individuals who maintain a lifestyle away from or without the use of electronic systems in both their personal and professional lives.
Please note that these categories aren’t automatic exemptions but just common circumstances that have allowed individuals to be exempt from using MTD.
How to Apply for a Making Tax Digital Exemption
You can apply for MTD exemption via the HMRC website for yourself or on behalf of someone else if you are their authorised agent or a friend or family member with their authorisation.
Steps to apply for MTD exemption for yourself:
- Gather essential information, such as your full name, address, National Insurance number, and reason for applying
- Call or write to HMRC using the contact details on the ‘Self Assessment: General Enquiries’ page
- Wait 28 calendar days for a response
Steps to apply for MTD exemption for someone else:
- Gather essential information, such as your connection to the applicant, their full name, address, National Insurance number, and reason for applying
- Call or write to HMRC using the contact details on the ‘Agent Dedicated Line: Self Assessment or PAYE for Individuals’ page
- Wait 28 calendar days for a response
Does VAT Exemption Apply to Income Tax?
If you are exempt from MTD for VAT, this does not automatically make you exempt from MTD for Income Tax.
The exemption process for VAT is different from the process for Income Tax, meaning that if you’re exempt from VAT, you may not be for Income Tax. You must check the current Income Tax exemption rules and contact HMRC if you believe that you qualify.
Handling Making Tax Digital on Your Behalf
If you’re unsure whether MTD applies to you or you think you may be exempt, we can help you understand. At LJS Accounting Services, we have a team of experienced MTD accountants who can discuss the new rules for Income Tax starting from 6 April 2026.
If MTD does apply to you and your exemption application is unsuccessful, we can assist you by handling your digital tax submissions, keeping up to date with any HMRC changes, and ensuring compliance throughout to avoid fines and penalties.
To discuss our MTD services, please contact our team today.
FAQs
Yes, if you are not exempt from MTD, you must comply with it. You can’t opt out of MTD unless you don’t qualify or you’re exempt.
No, there is no automatic exemption from Making Tax Digital based on your age. However, age-related circumstances may be considered if they affect your overall ability to use digital tools.
Applying for an exemption from MTD is generally quite easy if you provide enough evidence to HMRC, including the reason for the exemption. In other cases, when evidence is insufficient, the process can be longer or more complex.
The application process for MTD exemption via HMRC is quick. It involves you contacting HMRC directly by phone or in writing, then allowing them up to 28 days to respond with their decision.
