MTD Wave 1, 2 and 3 explained
Making Tax Digital arrives in three forced waves by qualifying income: over £50,000 from 6 April 2026, over £30,000 from 6 April 2027, and over £20,000 from 6 April 2028.
The three waves
| Wave | Mandated from | Threshold | Assessed on |
|---|---|---|---|
| 1 | 6 April 2026 | Over £50,000 | 2024/25 return |
| 2 | 6 April 2027 | Over £30,000 | 2025/26 return |
| 3 | 6 April 2028 | Over £20,000 (provisional) | 2026/27 return |
Each wave's threshold is qualifying income, gross and combined across all your self-employment and property sources, tested on the assessed year shown. Over the threshold on that one return is enough to mandate you, regardless of earlier or later years.
The rules most people miss
Start a new business after your wave's assessed year, and you're mandated from the start of your THIRD tax year after first exceeding the threshold, not immediately. Going the other way, you can only leave MTD once your qualifying income has been below the threshold for three successive tax years, or your business permanently closes. Partnerships are not included in any wave yet. An extension has been announced, but with no date.
Common questions
I am not near any of these thresholds, what do I do?
Nothing yet. Check back as your income changes, or after each Budget, since thresholds can move for years not yet assessed.
Can I join MTD before my wave is mandated?
Yes. Voluntary sign-up is available before mandation, and a voluntary cohort already exists from April 2025.
Are partnerships included in any wave?
Not yet. An extension to partnerships has been announced but with no date, so partnerships are not currently in scope.
Is the Wave 3 threshold definitely staying at £20,000?
The £50,000 threshold has already been assessed, against 2024/25 returns. The £30,000 threshold is equally fixed in policy, though its assessment year, 2025/26, has not been assessed yet. Only the £20,000 Wave 3 threshold is shown as provisional. It is current policy but could still change before 2026/27 is assessed, a Budget event is the usual trigger.