HMRC has updated its eligibility criteria for the Making Tax Digital for income tax self assessment (MTD ITSA) pilot scheme.

While MTD ITSA will not be compulsory until 6 April 2024, individuals and agents can sign up early to help HMRC test and develop the new system.

To sign up, the individual's accounting period must run from 6 April to 5 April each year, and they need to be using MTD-compatible software.

They must also be a UK resident, have a National Insurance number, be registered for self-assessment tax returns, and have up to date tax records.

Individuals will be ineligible if they have outstanding tax liabilities, need to report income or deductions from employment, pensions or student loan repayments, or if they have an income tax charge.

HMRC plans to widen the eligibility criteria to include more taxpayers over the course of the pilot.

Agents can also find out if they can sign up clients on their behalf. In order to do so, they must ensure their clients meet the same criteria, and check with them beforehand.

MTD for ITSA will apply to self-employed individuals and landlords whose total gross income from self-employment and property exceeds £10,000 in a tax year from April 2024 onwards.

Talk to us about your self-assessment returns.