Making Tax Digital (MTD) isn’t just another deadline; it’s a shift in how you manage your finances.
If you’re a sole trader earning over £50,000, April 2026 marks a major shift in how you submit your tax return.
That’s when Making Tax Digital for Income Tax (MTD for ITSA) becomes mandatory. It replaces your once-a-year Self Assessment with quarterly digital updates, meaning your record-keeping needs to be accurate, up to date, and cloud-based.
But don’t panic, we’ve created a simple MTD Readiness Checklist to help you prepare. It’s free to download, easy to follow, and designed to reduce overwhelm.
What This MTD Checklist Covers
This guide walks you through the key steps sole traders need to take before April 2026:
- Who MTD applies to (and when)
- What software you’ll need to use
- What HMRC will expect from you
- Common mistakes to avoid
- Where to get help if you’re unsure
You’ll also get a printable version to tick off as you go.
What Is Making Tax Digital?
Making Tax Digital is HMRC’s plan to modernise the UK tax system. It requires eligible businesses and individuals to:
- Keep digital records of income and expenses
- Use approved software for record-keeping
- Submit quarterly updates instead of an annual tax return
Who Needs to Follow MTD for Income Tax?
From April 2026, MTD applies to:
- Sole traders with total self-employed income over £50,000
- Landlords with property income over £50,000
From April 2027, the threshold drops to £30,000.
Even if you’re under the threshold now, preparing early will make life easier.
| Annual Income | MTD Compliance Date |
|---|---|
| £50,000+ | April 2026 |
| £30,000+ | April 2027 |
| £20,000+ | To be confirmed |
The MTD Readiness Checklist
Here’s a quick version of what you’ll find in the downloadable PDF. Use it as a roadmap to stay compliant and reduce stress.
Step 1: Confirm If MTD Applies to You
Check your total income from self-employment and/or property
If over £50,000, MTD applies from April 2026
If over £30,000, prepare now for April 2027
Stay informed about future changes from HMRC
Step 2: Choose MTD-Compatible Software
Use the software listed by HMRC (we recommend Xero)
Connect your bank feed
Enable receipt upload or app-based logging
Make sure it supports digital submissions
Spreadsheets alone won’t cut it unless linked to bridging software.
Step 3: Start Using the Software in 2025 (Not 2026)
Familiarise yourself with the interface
Import your existing income/expenses
Create categories that match HMRC reporting needs
Practice uploading receipts and logging mileage
Step 4: Understand What to Submit
You’ll need to send HMRC:
| Submission Type | Frequency | Includes |
|---|---|---|
| Quarterly Updates | Every 3 months | Income & expenses for the quarter |
| End of Period Statement | Annually | Final adjustments and taxable income |
| Final Declaration | Annually | Confirmation that info is accurate |
Set calendar reminders or ask your accountant to manage this for you.
Step 5: Keep All Records Digitally
Store invoices and receipts in the cloud
Log mileage and expenses as they happen
Avoid paper-only systems or once-a-year bookkeeping
Real-time record-keeping will save you from last-minute panic.
Step 6: Let Glow Accounts Help
We’re already helping sole traders prepare for MTD with:
- Xero setup and integration
- Training on using the software
- Quarterly submissions and end-of-year declarations
- Ongoing bookkeeping support
Call us on 01892 267750 or get in touch to make MTD stress-free.
Common Mistakes to Avoid
| Mistake | Better Approach |
|---|---|
| Waiting until 2026 | Get started in 2025 |
| Not using compliant software | Choose Xero, FreeAgent, or QuickBooks |
| Guessing how to submit | Get help from an accountant |
| Forgetting quarterly deadlines | Set automated reminders |
Summary: Key Takeaways
MTD becomes mandatory in April 2026 for income over £50,000
You’ll need to keep digital records and submit quarterly updates
Choosing the right software early is critical
Our checklist makes the whole process easier
Ask for Help Early
FAQs About MTD for Sole Traders
Do I need to do anything now if the deadline isn’t until 2026?
What kind of software do I actually need?
How do the quarterly submissions work?
Can I keep using spreadsheets and paper receipts?
What happens if I’m not ready by 2026?
Where can I get help if I’m feeling lost?
Not Sure Where to Start?
You’re not alone. Many sole traders feel unsure about which software to use, when to switch, or what actually needs submitting to HMRC.
That’s exactly why we created this checklist. It gives you a clear roadmap to follow, with no jargon and no fluff.
But if you’d prefer a walkthrough, we’re here to help.
Call us on 01892 267750 or get in touch to make MTD stress-free.
How Glow Accounts Can Help Your Business
Making Tax Digital doesn’t need to feel overwhelming. At Glow Accounts, we support sole traders and small businesses across the UK to:
- Set up Xero or other MTD-compatible software
- Stay compliant with quarterly submissions
- Keep digital records properly organised
- Focus on your business, not just the books
Whether you’re brand new to accounting software or already partway there, we’ll meet you where you’re at.
Call us today on 01892 267750 to make Making Tax Digital as stress-free as possible.
