Making Tax Digital (MTD) for Sole Traders – Important Changes from 6th April

05 March 2026

From 6th April, important changes are being introduced by HM Revenue & Customs (HMRC) under the continued rollout of Making Tax Digital (MTD).

As a result, many sole traders will be required to register and begin submitting quarterly returns.

Making Tax Digital is the government’s initiative to modernise the UK tax system by replacing annual paper-based returns with digital record keeping and more regular reporting. While MTD already applies to VAT-registered businesses, the next phase extends to sole traders and landlords who submit Income Tax Self Assessment returns and meet the income threshold. Instead of filing one annual tax return, affected sole traders will need to keep digital records and submit quarterly summaries of income and expenses using compatible accounting software. At the end of the tax year, an end-of-period statement and final declaration will confirm overall taxable income.

The objective is to provide business owners with a clearer, more up-to-date view of their tax position, reducing errors and unexpected liabilities. However, the move represents a significant adjustment for those relying on spreadsheets or manual systems. Although tax is not necessarily paid quarterly, accurate and consistent bookkeeping will be essential to remain compliant and avoid potential penalties.

How Evans Entwistle Can Help

At Evans Entwistle, we can manage the entire MTD transition on your behalf — from registration with HMRC to setting up compliant software and handling your quarterly submissions. If you are unsure whether the new rules apply to you, or simply want the process handled professionally and stress-free, contact our team today and we will ensure you are fully compliant ahead of the April deadline. Registering early is strongly recommended to allow time to choose suitable software, set up digital systems, and seek professional advice where needed. Preparing now will help ensure a smooth transition and minimise disruption when quarterly reporting becomes mandatory.