Making Tax Digital Accountant London

Practical Making Tax Digital support for sole traders and landlords

Making Tax Digital (MTD) for Income Tax is changing how sole traders and landlords keep records and report income to HMRC. If you are affected, you will need compatible software to maintain digital records, send quarterly updates and submit your year-end tax return.

I help sole traders, landlords and people with both types of income understand their obligations and establish a practical approach to compliance.

Already affected by the April 2026 start date, or preparing for a future deadline? I can help you review your qualifying income, check your software arrangements and understand the steps you need to take. Call 020 8930 3983 or send an enquiry to discuss your circumstances.

What Is Making Tax Digital

Making Tax Digital (MTD) is HMRC’s system for keeping digital records and reporting certain income using compatible software. For people within the Income Tax rules, the main requirements are to:

• Keep digital records of relevant business and property income and expenses.
• Submit quarterly updates to HMRC using compatible software.
• Complete and submit a tax return through compatible software after the end of the tax year.
• Include other relevant income, adjustments, reliefs and allowances when completing the tax return.
  

Quarterly updates are summaries of income and expenses, rather than four separate tax returns. You still need to complete the year-end tax return and pay any tax due by the normal deadline (usually 31 January following the end of the tax year).



The rules for Income Tax are separate from Making Tax Digital for VAT. If you are VAT-registered, different digital record-keeping and VAT return requirements may already apply to you.

Who needs to use MTD and when?

The start date depends on your qualifying income. This is the total gross income from self-employment and property (before expenses) shown on the relevant previous tax return. It is not the same as profit or taxable income after deductions. Employment income, dividends and pension income are not included.

The current phased timetable for Qualifying income shown on tax return is:

More than £50,000 in the 2024/25 tax year - Start Date 6 April 2026
More than £30,000 in the 2025/26 tax year - Start Date 6 April 2027
More than £20,000 in the 2026/27 tax year - Start Date 6 April 2028

These thresholds relate to the qualifying income rules, not simply your total income from every source. For example, employment income, dividends and pension income are not included in the qualifying-income calculation in the same way as sole-trader and property income.

If you have both self-employment and rental income, the amounts are considered together. Always check your own circumstances and previous tax return.

Already affected by the April 2026 start date? If your qualifying income was over £50,000 in 2024/25, check whether you need to sign up, whether HMRC has contacted you and whether your software and records are ready. If you are unsure, I can help you review the next steps.

What do the quarterly updates involve?

You must keep digital records up to date and send quarterly summaries to HMRC through compatible software.

For standard update periods aligned with the tax year, the usual deadlines are:

6 April to 5 July - Submission deadline 7 August
6 April to 5 October - Submission deadline 7 November
6 April to 5 January - Submission deadline 7 February
6 April to 5 April - Submission deadline 7 May

Different update periods may apply depending on your accounting period and software settings, so confirm the dates that apply to you.

Important for 2026/27: HMRC will not issue penalty points for late quarterly updates in the 2026/27 tax year. Updates are still required, and this temporary easement does not remove other obligations. Late tax returns and late tax payments can still attract penalties and interest.

The best approach is to keep records regularly rather than leave several months of bookkeeping until a deadline is approaching. 

How I can help with Making Tax Digital

The support you need will depend on your current bookkeeping arrangements, the number of income sources you have and how confident you are using accounting software.

I can discuss the following areas with you:

1. Understanding your obligations

We can review your self-employment and property income, your previous tax return and the relevant thresholds to establish whether MTD for Income Tax is likely to apply and when you may need to act.

2. Choosing compatible software

The right software should fit the way you work. We consider your bookkeeping needs, the number of properties or business activities you have, reporting requirements and the level of support you want.

Software options include Xero, QuickBooks or Sage, provided the particular product and version supports the MTD functions you need. HMRC’s list of compatible software should be checked before making a decision.

3. Setting up digital records

Good records make it easier to keep track of income and expenses throughout the year. I can help you consider a practical approach to recording transactions, organising supporting documents and keeping your information up to date.

4. Quarterly updates and year-end reporting

Depending on the service agreed, I can help prepare and submit quarterly updates, review records and assist with your year-end tax return. We will establish who is responsible for each task and what information you need to provide.

5. Guidance and ongoing support

If you are unfamiliar with digital bookkeeping, I can explain the process and help you understand what you need to do. The aim is to establish a manageable routine rather than make tax administration more complicated.

How to prepare for Making Tax Digital

If you think you may be affected, these are useful first steps:

Review your previous tax return. Check the relevant gross income from self-employment and property before expenses.

Confirm your start date. Use HMRC’s current guidance and check whether you have received a notification or need to sign up.

Review your bookkeeping. Identify how you currently record income, expenses and supporting documents.

Choose compatible software. Check that it supports the MTD functions you need before committing to a product.

Plan for quarterly deadlines. Decide how often you will update your records and who will submit the updates.

Review your year-end process. Remember that quarterly updates do not replace the final tax return or payment of tax.

If you already use accounting software, you may not need to start again. The important question is whether your current arrangements meet the requirements for your circumstances.

Making Tax Digital for VAT is separate from MTD for Income Tax. VAT-registered businesses generally need to keep relevant VAT records digitally and submit VAT returns using compatible software, subject to the rules and any applicable exemptions.

If you are already VAT-registered, I can discuss how your current bookkeeping and VAT arrangements fit with your wider accounting needs. If you are a landlord or sole trader who is not VAT-registered, you may still need to use MTD for Income Tax if you meet the relevant criteria.

Why Choose Andrew Passer for Your MTD Needs?

• Local expertise serving Stanmore, Edgware, Harrow, Finchley, North West London and Greater London area
• Clear, jargon-free advice
• Full training and hands-on help
• Focus on peace of mind so you never worry about getting it wrong

Experienced and committed to providing exceptional service to help you manage your finances more effectively.

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