Am I exempt from Making Tax Digital?
Some exemptions happen on their own. Others only protect you once HMRC has said yes — and that difference is the one that costs people money.
Believing you qualify is not the same as being exempt. If your exemption is one you have to apply for, your deadlines keep running until HMRC grants it. Assume you are in until you hear otherwise.
Automatic — nothing to do
These need no application. If one describes you, you are outside the regime without lifting a finger.
Qualifying income of £20,000 or less
The simplest one, and the one that covers most people. HMRC’s own words are “automatically exempt … if your qualifying income is £20,000 or less”. Note the threshold has fallen at every phase so far, so this is not permanent cover.
No National Insurance number before the start of the tax year
You cannot sign up without one, so you are exempt automatically. Nothing to do.
A trust submitting an SA900
Trusts filing an SA900 are outside MTD, including charitable trusts and non-registered pension scheme trusts. This covers the trust — qualifying income you hold personally is still tested.
Acting as personal representative of someone who has died
Automatically exempt for the estate you are administering.
Lloyd’s member with underwriting business (SA103L)
Automatically exempt if you included the SA103L supplementary page as a Lloyd’s member in your 2024/25 return.
You must apply — and be granted it
These are real exemptions, but they are requests. Until HMRC agrees, you are in scope and your quarterly deadlines are running.
Digitally excluded
For where it is not reasonable for you to use compatible software — disability, religious belief incompatible with digital communication, or no internet access. You must apply and be granted it; qualifying on paper is not the same as being exempt.
Foster or kinship carer claiming qualifying care relief
You must apply if you reasonably expect to claim qualifying care relief. Note HMRC has this exemption running only until April 2027 — it is not permanent, and it is not automatic.
Non-UK resident needing the SA109 page
You must apply if you anticipate needing the SA109 supplementary page because you are non-resident for that tax year.
Apply through HMRC: Find out if you can get an exemption from Making Tax Digital for Income Tax. Apply early — an application sitting in a queue does not pause a deadline.
Things that are not exemptions
Some situations feel like they should let you out and do not. Being in a partnership does not exempt you personally — your partnership income simply does not count toward your threshold, and any self-employment or property income you have is tested as normal. Having an accountant does not exempt you; they can do the filings, but the obligation is yours. And not having received a letter is not an exemption either — HMRC expects you to check.
Common questions
Am I exempt from Making Tax Digital?
You are automatically exempt if your qualifying income is £20,000 or less, if you have no National Insurance number before the tax year starts, if you are a trust filing an SA900, if you act as personal representative of someone who has died, or if you are a Lloyd's member who filed the SA103L page. These need no application.
Which exemptions do I have to apply for?
Digital exclusion, the foster and kinship carer exemption, and the non-UK resident exemption all have to be applied for and granted by HMRC. Until an application is granted you are still in scope and your deadlines still run.
What counts as digitally excluded?
HMRC applies it where it is not reasonable for you to use compatible software — for example because of a disability, because you have no internet access, or because of a religious belief incompatible with using computers. You must apply; believing you qualify is not the same as being exempt.
Does the foster carer exemption last?
No. HMRC has it running only until April 2027, and it must be applied for. Foster and kinship carers who expect to claim qualifying care relief should not assume they are permanently outside the regime.
Can I leave Making Tax Digital if my income drops?
Not after one bad year. The widely-reported position is that you need three consecutive years of qualifying income below the threshold. We have not been able to confirm that wording on an HMRC page, so treat it as unsettled and check before relying on it.
Check whether you are in scope — the checker has all of these built in, so you can tick your situation and see the answer. Every rule on this page is cited to HMRC.
Tax Threshold gives information, not tax advice. Exemption applications turn on your circumstances — if you think you qualify, talk to HMRC or an accountant rather than relying on a web page.