Which income year decides your start date?
Making Tax Digital for Income Tax already applies to the first cohort of sole traders and landlords. Check your qualifying income for the comparison year, then check exemptions. The same rules apply to other self-employed trades; the trade name does not set the threshold.
| Qualifying income is more than | Comparison tax year | Required start |
|---|---|---|
| £50,000 | 2024/25 | 6 April 2026 |
| £30,000 | 2025/26 | 6 April 2027 |
| £20,000 | 2026/27 | 6 April 2028 |
Use HMRC’s eligibility checker even if you have not received a letter. Exemptions can be automatic or require an application: use the current HMRC guidance for your circumstances.
Fictional case: materials costs do not turn income into profit
Fictional example. In 2024/25 a sole-trader electrician has £46,000 self-employment income before expenses and £7,000 property income before expenses. The combined qualifying income is £53,000. Deducting materials and other business costs to find profit does not change that threshold calculation. Subject to the applicable exemptions, this case falls in the 6 April 2026 cohort.
PAYE wages and dividends do not count towards qualifying income. More than one self-employment or property source can count. HMRC explains special cases, including jointly owned property and VAT treatment; use the figures on the relevant return rather than just a bank balance.
Source: HMRC: qualifying income
7 November: prepare a cumulative update
For 2026/27 the next quarterly-update deadline is 7 November 2026. Standard periods cover 6 April to 5 October cumulatively; calendar periods cover 1 April to 30 September. Each update covers the start of the tax year to the end of the update period, not just the latest three months. The other annual deadlines are 7 August, 7 February and 7 May.
Updates summarise income and expenses for each relevant business. They are not quarterly tax returns or four new tax-payment dates. HMRC will not apply late-quarterly-update penalty points in 2026/27, but the updates are still needed before submitting the tax return; late-return penalties remain separate.
Copy this record-readiness worksheet
| Record | Your entry |
|---|---|
| Comparison year and qualifying income sources | Year: ___; self-employment: ___; property: ___ |
| HMRC checker and exemption decision | Checked on: ___; result or application reference: ___ |
| Required start date and update period | Start: ___; standard/calendar: ___ |
| Each business’s digital income/expense records | Records held in: ___; missing documents: ___ |
| Compatible software and authorised agent | Software: ___; who checks/sends: ___ |
| Next update and reconciliation | Period end: ___; deadline: ___; check date: ___ |
Keep this with your own business records. Reconcile invoices, receipts and payments, and resolve missing items with your accountant. Keep tax identifiers and financial information out of public examples.
Choose filing software separately from job paperwork
Use HMRC’s compatible-software finder for the actual reporting service. Choose the filing service for your income sources and authorise it with HMRC.
Tradehand’s quoting workflow helps record the agreed work and your own prices. Keep the resulting invoices and payments with your accounting records. For first-year registration and payment dates, use the UTR and Self Assessment guide; for upcoming changes, use the current trade rules board.
Source: HMRC: compatible software finder
