Exemptions from MTD for ITSA

Exemptions

Income exemptions

If your total combined income from self-employment and property is less than £50,000, you are currently exempt from MTD for ITSA until 2027 where the threshold becomes £30,000 and the threshold reducing to £20,000 from 2028.

It is important to note that the threshold is based on your total sales, not your profit.

Digital exemptions

Entities/individuals can apply to be exempted from MTD if any of the following apply:

It is not reasonably practicable for them to use digital tools to keep their business records or submit quarterly returns due to age, disability, remoteness of location or any other reason, often referred to as ‘digital exclusion’.
They are subject to an insolvency procedure.
The business is run entirely by practising members of a religious society or order whose beliefs are incompatible with using electronic communications or keeping electronic records.

Other exemptions

The following are also exempt:

Non-resident companies.
Trustees, executors and administrators.
Foreign businesses of non-UK domiciled individuals.