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SOLE TRADERS & LANDLORDS

Is your business ready for Making Tax Digital?

HMRC has changed how sole traders and landlords report income. Quarterly updates replace the single January scramble, and the threshold drops every year until most self-employed people are in scope.

When it hits you

FIG. 03 · MTD FOR ITSA

APRIL 2026

Over £50,000

Sole traders and landlords with qualifying income above £50,000 must comply with MTD for Income Tax.

APRIL 2027

Over £30,000

The threshold drops, bringing a much larger group of self-employed people into scope.

APRIL 2028

Over £20,000

Proposed extension. On current plans, most self-employed individuals will be affected.

What actually changes

Four quarterly submissions instead of one annual return, digital records rather than a shoebox, and compatible software in place before your first period starts. It's more admin, unless someone else does it.

·Quarterly updates to HMRC instead of one annual return

·Digital records, spreadsheets alone won't satisfy it

·MTD-compatible software in place before your first period

·A final declaration at the end of each tax year

·Penalties for late quarterly submissions, not just late tax