Support for sole traders and landlords
Making Tax Digital for Income Tax
Making Tax Digital for Income Tax changes how qualifying sole traders and landlords keep records and report information to HMRC. Digital records and quarterly updates become part of the Self Assessment process.
We can help you understand whether MTD for Income Tax affects you, get your records organised and agree the support you need throughout the year.
Who needs to use MTD for Income Tax?
You may need to use MTD for Income Tax if you are registered for Self Assessment, have submitted a tax return and receive income from self-employment as a sole trader, property as a landlord, or both.
Your start date depends on your qualifying income. This is broadly your combined gross turnover or income from self-employment and property before expenses, based on the relevant previous tax return.
- More than £50,000 on your 2024/25 tax return: MTD from 6 April 2026.
- More than £30,000 on your 2025/26 tax return: MTD from 6 April 2027.
- More than £20,000 on your 2026/27 tax return: MTD from 6 April 2028.
Exemptions and special circumstances can apply. We'll help you check your position rather than assume the rules apply to everyone who is self-employed or lets property.
What changes under MTD?
Digital records and compatible software
You or your agent need to keep digital records of relevant self-employment and property income and expenses. Compatible software uses those records to prepare and send updates to HMRC.
Quarterly updates and an annual tax return
Quarterly updates summarise your records during the year. You still need to complete an end-of-year tax return, bringing together the information needed to finalise your tax position.
Quarterly updates, without four extra tax returns
Quarterly updates are summaries of relevant income and expenses, not separate tax returns. Sending an update does not finalise your tax liability.
The standard quarterly update deadlines are 7 August, 7 November, 7 February and 7 May.
If you have more than one relevant self-employment business, separate digital records and quarterly updates may be required for each. We'll agree what information is needed and when, based on your circumstances.
How we can help
Baldwin's Accountancy Services can help you move from understanding the requirements to a manageable routine. Depending on the service we agree, support may include:
- Checking whether you are likely to fall within MTD for Income Tax and preparing for your start date.
- Setting up or reviewing suitable software and digital record keeping.
- Providing bookkeeping support to keep your records up to date.
- Preparing or reviewing and submitting quarterly updates where we are engaged to do so.
- Dealing with your year-end tax return.
- Explaining what information we need from you and when.
Start with organised records
Keeping your bookkeeping up to date gives you a clearer starting point for each update and the annual return. We'll agree who maintains the records and how information will be shared.
We work with cloud accounting software including Xero, QuickBooks and FreeAgent. These are not the only options for MTD. We'll help you consider suitable compatible software for the work you need to do.
Our bookkeeping and Self Assessment services can support the regular records and year-end work alongside your quarterly updates.
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Unsure where to start?
If you're a sole trader or landlord and are unsure whether MTD affects you, or want help getting ready, tell us about your circumstances. We'll discuss the next steps and the support you need.
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