Are you exempt from the New MTD Rules?
- 18th November 2025
With less than six months to go until Making Tax Digital (MTD) becomes compulsory for sole traders and landlords earning more than £50,000 a year, many will be preparing for the shift to digital record-keeping. While most people will need to comply, HMRC recognises that some individuals cannot meet the requirements and may grant an exemption.
HMRC has now opened applications for those who believe they are digitally excluded. This may apply if you cannot access broadband where you live or work, if your age, health or disability prevents you from using digital tools, or if your religious beliefs mean you do not use electronic devices.
When HMRC May Agree You Are Digitally Excluded
Lack of internet access
If broadband is unavailable at your home or business premises and there is no practical alternative nearby, you may fall within the exemption criteria.
Age, health or disability
You will need to show that your circumstances make it unreasonable or impossible for you to use a computer, tablet or smartphone to keep or submit digital records.
Religious beliefs
Members of religious orders or communities whose beliefs prevent the use of digital devices for day-to-day life may also qualify.
HMRC reviews applications individually and may consider other exceptional reasons that make digital record-keeping impractical. If you already hold an exemption from MTD for VAT, and nothing has changed, this will normally extend to MTD for income tax.
When HMRC Will Not Grant an Exemption
An application will be rejected if the only reason is that someone:
- Has always filed paper returns
- Is unfamiliar with digital accounting software
- Only keeps a small number of digital records each year
Extra costs or the time needed to comply will not be accepted as grounds for exemption.
You can find HMRC’s full guidance on applying for an exemption here.
Phoebe Hall, MTD Specialist at Forrester Boyd, says: “We know the move to MTD feels daunting for some people. HMRC does offer exemptions, but they are only for clients who genuinely cannot use digital tools. If you are unsure where you stand, it’s worth speaking to us early so we can guide you through your options.”
If you think you may qualify for an exemption, or if you simply want help preparing for MTD, our team is ready to support you. Get in touch with your usual Forrester Boyd contact or speak to our digital support specialists today.
All data and figures referred to in our news section are correct at the date of publishing and should not be relied upon as still current.
