A 3-minute read for UK sole traders. No login, no email signup, no jargon.
MTD ITSA: who's in, when, what you actually do
Making Tax Digital for Income Tax Self Assessment changes how you tell HMRC about your sole-trader profit. It does not change how much tax you pay. Here is the whole thing on one page.
1. Are you in?
It comes in by income threshold, not by tax year of birth or business size. "Income" here means your gross sole-trader turnover plus any property income, before expenses.
| From April | Threshold (gross income) | Effect |
|---|---|---|
| 2026 | £50,000+ | Mandatory |
| 2027 | £30,000+ | Mandatory |
| 2028 | £20,000+ | Mandatory |
| Below £20,000 | n/a | Stay on Self Assessment as today |
HMRC checks the threshold against the return you filed two years before the start date, so 2024-25 figures decide whether April 2026 applies to you.
2. What you actually have to do
- Keep digital records. A spreadsheet counts, as long as it's the source of the numbers and not retyped from paper.
- Send four quarterly updates. Totals per category, not line-by-line. You can correct figures later, these are not the final return.
- Send a final declaration once a year by 31 January, the same date you already know. This replaces the Self Assessment return.
- Use MTD-compatible software to file. Your spreadsheet feeds it; the software talks to HMRC.
3. The four deadlines, in order
| Quarter ends | File by |
|---|---|
| 5 July | 7 August |
| 5 October | 7 November |
| 5 January | 7 February |
| 5 April | 7 May |
You can elect to align quarters to calendar months (1st-end-of-month), most sole traders do, because invoicing already runs that way. The deadlines move accordingly.
4. What stays the same
- Tax rates and the personal allowance.
- Cash basis vs accruals, your choice, same as now.
- Simplified expenses: mileage (45p / 25p), working-from-home flat rate (£10/£18/£26), simplified use-of-home.
- Class 4 NIC at 6% main rate, 2% above £50,270.
- Payments on account in January and July.
5. The honest bit
If you already track money in and out in a spreadsheet by category, MTD ITSA is mostly a calendar problem: four "send" buttons a year instead of one. If you keep receipts in a shoebox, this is the year to fix that, not because HMRC will inspect you, but because four times a year is four chances to be caught short.
£19
The Tidy Trader Sole Trader Pack is the spreadsheet half of the MTD ITSA stack. Eight CSVs and a short PDF guide: income, expenses with allowable Y/N, mileage at 45p/25p, WFH flat rate, the four MTD quarters already shaped, a tax estimator and an invoice template. Works in Excel, Numbers, Google Sheets and LibreOffice.
One payment, no subscription. Free patch if HMRC moves a rate during the year.
Sources
Thresholds and start dates: gov.uk, Check if you'll need to sign up for Making Tax Digital for Income Tax. Quarterly deadlines and software requirements: gov.uk, Using Making Tax Digital for Income Tax. Always check the live GOV.UK page in case HMRC moves a number, we patch the pack when they do.