HMRC is set to eliminate paper letters for millions of taxpayers starting in April of next year. The tax office had previously announced a move towards a “digital by default” approach to save £50 million annually by 2028/29.

In the recent Budget announcement, it was confirmed that the gradual phasing out of paper communications will commence in April 2026. Going forward, taxpayers will receive digital letters through their HMRC online account or the HMRC app. However, HMRC will continue to send letters to households without internet access or facing difficulties with digital services, and their phone lines will remain operational.

Taxpayers who prefer paper correspondence can opt to continue receiving it. Initially, those using the HMRC app, online Personal Tax Account (PTA), or Business Tax Account (BTA) will be affected.

HMRC will prompt individuals to verify their contact details when the rollout begins. The tax office issues letters for various reasons, such as notifying about changes in tax codes or the requirement to register for self-assessment.

HMRC has already dispatched over 200,000 letters to sole traders and landlords with qualifying income over £50,000, who will soon need to submit quarterly updates using HMRC-approved software if their turnover exceeds £50,000 from self-employment or property income.

While the rollout begins in April 2026, HMRC advises people to prepare for the transition in advance. Taxpayers will need suitable software, with both free and paid options available. The software provides real-time tax bill estimates throughout the year, aiding in cash flow planning and preventing surprises during tax season.

Craig Ogilvie, the Making Tax Digital director, emphasized the importance of preparing for the upcoming changes, stating that MTD for Income Tax will spread tax administration across the year, avoiding the last-minute rush during Self Assessment season. Free software options are accessible, and initial feedback indicates that the system is user-friendly once individuals become familiar with it.