HMRC to Contact UK Households Next Week Over Major Tax Rule Change — What You Need to Know

Millions of UK households are set to receive letters from HM Revenue & Customs (HMRC) starting next week, warning about a major tax rule change. While receiving an official letter from HMRC can feel intimidating, knowing what it’s about and what actions to take can save you stress and prevent mistakes.

This change is part of the government’s digital modernisation of tax reporting, and it particularly affects self-employed people, landlords, and households with certain types of income.

Why HMRC Is Reaching Out

HMRC is rolling out letters — by post and digitally — to inform households about upcoming changes under Making Tax Digital for Income Tax (MTD for IT).

From April 2026, taxpayers in affected categories will be required to keep digital records and submit quarterly tax updates instead of relying on the traditional annual Self Assessment system. The goal is to reduce errors, improve efficiency, and modernise the tax system.

The letters are a heads-up to ensure households can prepare in advance, set up digital accounts, and avoid last-minute problems.

What Is Making Tax Digital?

Making Tax Digital (MTD) is HMRC’s long-term programme to modernise the UK tax system. It has already applied to VAT, and now it is expanding to income tax.

The system requires:

Digital record-keeping of income and expenses

Quarterly submission of income data to HMRC via approved software

Reduced reliance on the traditional annual Self Assessment form

This change is designed to make tax reporting simpler, more accurate, and faster for both HMRC and taxpayers.

Who Will Be Contacted?

Not all households will receive letters. HMRC is targeting:

Self-employed individuals earning above £50,000

Landlords with rental income above £50,000

Households with multiple income streams that meet the threshold

Even households below these limits may receive information as a heads-up for longer-term plans.

Steps You Should Take

If you receive a letter from HMRC, here’s how to respond:

1. Check Your Tax Status

Verify whether you currently submit Self Assessment forms and whether your income meets the MTD thresholds.

2. Set Up Digital Record-Keeping

If required, adopt approved digital software to track income and expenses. Many online systems simplify quarterly submissions.

3. Read the Letter Carefully

Follow any instructions, including deadlines or steps to sign up for MTD. Even if you think you are exempt, check if you qualify for exemptions.

4. Keep Your Contact Info Updated

Ensure HMRC has your current address and digital contact details to receive future communications.

Why the Change Matters

MTD is not just a bureaucratic adjustment — it represents a significant transformation in UK tax administration.

The benefits include:

Improved accuracy in reporting income

Faster processing of tax data

Reduced penalties from errors or late filing

A smoother, more modern digital system for taxpayers

However, some taxpayers may find quarterly submissions challenging, especially if they are less familiar with digital tools.

Common Concerns

Receiving an HMRC letter does not automatically mean you owe more tax. These letters are informational and aim to prepare taxpayers for upcoming changes.

Exemptions exist for people unable to use digital systems due to accessibility issues. HMRC guidance explains how to apply for these exemptions.

Always beware of scam messages. HMRC will never ask for sensitive financial information through unsolicited links. Always use official channels to respond.

Preparing for a Smooth Transition

Early preparation is key. Steps to make the transition easier include:

Reviewing your current income and expenses

Selecting the right digital accounting software

Planning ahead for quarterly submissions

Consulting an accountant or tax advisor if needed

By being proactive, households can make the move to MTD stress-free and manageable.

Final Thoughts

The HMRC tax rule change and the move toward Making Tax Digital represent a significant evolution in the UK tax system. While it may feel daunting at first, early preparation, digital record-keeping, and understanding the requirements can make compliance straightforward.

Receiving a letter from HMRC is an opportunity to prepare, not a cause for alarm. Staying informed and proactive ensures a smooth transition to the new system — and peace of mind for the months ahead.