When does Making Tax Digital start for sole traders?

Short answer

From 6 April 2026 if your combined self-employment and property income is over £50,000, and from 6 April 2027 if it is over £30,000. Below £30,000 no start date has been set. Once in, you file four quarterly updates plus an end-of-period statement and final declaration.

Making Tax Digital for Income Tax Self Assessment applies to individuals with self-employed income, property income, or both, measured on gross combined income rather than profit. The thresholds are £50,000 from 6 April 2026 and £30,000 from 6 April 2027; anything below £30,000 remains under consultation with no commencement date. Joint property income is split between owners for the threshold test, and partnerships are not yet in scope.

What you actually have to file

Four quarterly updates of summary income and expenses by category. The standard quarters end on 5 July, 5 October, 5 January and 5 April, with each update due on the 7th of the second month afterwards — so the 6 April to 5 July quarter is due by 7 August. Calendar quarters can be elected instead.
End-of-period statement, confirming the quarterly figures and adding the adjustments — capital allowances, accruals, private use, balancing charges — by 31 January after the tax year ends.
Final declaration, which replaces the Self Assessment return entirely and captures everything else: employment income, dividends, savings interest, pension contributions, Gift Aid, capital gains and reliefs. Also due 31 January.

Quarterly updates are summary only. They produce no tax bill, and the payment dates are unchanged — payments on account on 31 January and 31 July, balancing payment the following 31 January.

Software and getting ready

Records must be kept digitally in software that connects to HMRC's API. Mainstream packages all qualify, and spreadsheets plus bridging software are expressly permitted, which is the cheapest route for many sole traders. HMRC does not supply free MTD ITSA software of its own. Some banks bundle a package with a business account.

Late submission moves to a points-based system: each missed quarterly update earns a point, and four points in a year triggers a £200 penalty, with a further £200 for each subsequent failure. Late payment is charged as a percentage of the unpaid tax, nothing within 15 days, 2% from 16 to 30 days, then 4% plus a daily rate beyond 30 days, with interest running throughout.

Practical preparation is mostly about habit rather than technology. Start keeping digital records now, settle on consistent expense categories so the quarterly summaries mean something, and get a fixed quote from your accountant — expect roughly £400 to £1,000 a year for a straightforward sole trader, more for landlords with several properties. Exemption is available only in narrow cases such as disability, religious grounds or no realistic internet access, and must be applied for.

Read the full guide: Making Tax Digital for Income Tax Self-Assessment (MTD ITSA): What Sole Traders Need to KnowCovers eligibility, the process, deadlines, and next steps in depth.

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