HMRC's final MTD nudge letters: what self-assessment taxpayers should do now

CREATED BY ROGER EDDOWES Published: 19/02/2026 @ 09:00AM #NudgLetters #MTD #MakingTaxDigital #SelfAssessment #HMRC #IncomeTax

HMRC is issuing MTD nudge letters based on 2024/25 returns, and some may arrive in late March. If your income tops £50,000, action may be needed even without a letter. If you receive one, read it, confirm your status, then sign up early ...

MTD nudge letters, Guiding us towards success, Gentle reminders

Many self-assessment taxpayers will soon notice Making Tax Digital nudge letters arriving from HMRC, and the timing is deliberate rather than random. The trigger is what was reported on your 2024/25 tax return, with the focus on whether the taxpayer's total income from sole trade and/or property activity crosses the £50,000 threshold.

The sending pattern matters because it explains why
some people will hear sooner than others!

If you filed between early September and the end of November 2025, then you're first in line, while those who filed from December 2025 onwards are queued for letters from mid-March 2026. Each wave takes about a fortnight to complete, so some individuals might have to wait until late March or early April to see anything land on the doormat.

The underlying test is straightforward in principle!

HMRC is looking at your total income, not profits, from relevant business sources in 2024/25. If that exceeds £50,000 and no exemption applies, the expectation is that you will follow the Making Tax Digital rules for income tax from April 2026. The nuances are in the exemptions, because some are automatic while others require an application; that difference can change the practical next steps.

Even though HMRC letters are being issued, you must still check whether you fall within scope and, if you do, take steps to sign up in time. In other words, MTD nudge letters are helpful signals, but they are not the mechanism that creates the obligation.

If you suspect you are in scope, but have not received anything, waiting is the least efficient strategy. A missing letter does not reduce the requirement to move onto Making Tax Digital, and HMRC's published sign-up guidance exists precisely for that scenario. From a risk-management perspective, early action also leaves space to resolve access issues, software choices, or exemption queries without a last-minute scramble.

There is, however, one reassuring detail for anyone
worried about the first year of change!

HMRC has suggested that there will be no penalties if any of the first four quarterly updates are submitted late, but this position could easily change. That does not eliminate the need for good tax compliance, but it does make the transition potentially less punitive while processes settle.

The practical takeaway is simple: treat the arrival of MTD nudge letters as a prompt to verify your 2024/25 income position, confirm whether an exemption applies, and plan sign-up rather than merely file the letter away. If it never arrives, act on the underlying facts, because the scope test does not depend on the envelope.

And if it does arrive, HMRC's final MTD nudge letters should be seen as the moment to get ahead of April 2026 rather than chasing it.

Until next time ...

ROGER EDDOWES
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About Roger Eddowes ...
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach. Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.

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