Making Tax Digital Bookkeeping for Sole Traders
Digital records kept and quarterly figures prepared, so every MTD update is ready to approve.
Making Tax Digital overview
Making Tax Digital for Income Tax replaces the once-a-year scramble with four quarterly updates. Sole traders and landlords with qualifying income over £50,000 joined on 6 April 2026. From 6 April 2027 the threshold falls to £30,000, judged on your 2025-26 tax return, and from April 2028 to £20,000. Qualifying income is your turnover and gross rent before expenses, not your profit.
MTD asks for three things: digital records of every income and expense, HMRC-compatible software, and an update for each self-employment or property business by 7 August, 7 November, 7 February and 7 May. The year then ends with a tax return through the same software, due by 31 January. None of it is hard once the records are kept as you go.
We set up or tidy your software, connect bank feeds and agree how receipts reach us. Every month we categorise transactions and flag anything unclear. Before each deadline we send you the quarter's figures to approve, and you or your UK accountant submit the update in a few clicks. At year end we prepare the adjustments your tax return needs.
Prefer to talk it through first? Call +971 54 542 4854 or email info@hof-partners.com.
What MTD bookkeeping includes
- Software set-up
- HMRC-compatible software chosen or tidied, with bank feeds connected and categories that match HMRC's.
- Digital records
- Every income and expense recorded digitally with its receipt attached, as MTD requires.
- Quarterly figures
- Each business's quarter totalled and checked, then sent to you for approval ahead of the deadline.
- Separate income sources
- Self-employment and property income kept apart, with joint property shares recorded correctly.
- Year-end adjustments
- Capital allowances, accruals and private-use adjustments prepared for your tax return.
- Deadline calendar
- A reminder before each quarterly date, with a list of anything we still need from you.
Four quarterly updates a year, each one ready before the deadline arrives.
Questions about Making Tax Digital
Yes, if the qualifying income on your 2025-26 tax return is over £30,000. Qualifying income is your self-employment turnover plus your gross property income, before expenses, so a landlord with high mortgage costs can still be in. HMRC's online checker on GOV.UK confirms if and when you need to start.
Quarters run to 5 July, 5 October, 5 January and 5 April, and updates are due by 7 August, 7 November, 7 February and 7 May. You can choose calendar quarters instead and the deadlines stay the same. The tax return for the year, and any tax owed, are due by 31 January.
No. We prepare the figures in your software and send them to you to approve. You then submit the update from the software, or your UK accountant submits it as your agent. We never file with HMRC ourselves.
Any product on HMRC's list of software compatible with MTD for Income Tax. Cloud accounting products such as Xero, QuickBooks, Sage and FreeAgent offer it, and spreadsheets can still be used with bridging software. We help you choose based on your income sources and what your accountant uses.
Each late update earns a penalty point, and once you reach 4 points each further late submission costs £200. HMRC is not giving points for late quarterly updates in 2026-27 to those who joined in April 2026. Late payment penalties and interest are charged separately.
Yes. We keep the records and prepare the quarterly figures; your accountant reviews, submits and completes your tax return as usual. If your accountant wants a bookkeeping team for all their MTD clients, see outsourced bookkeeping for accountants.
More ways we can help
All services- For accountancy practicesA white-label bookkeeping team that works in your software, to your checklists, under your name.
- BookkeepingBooks posted, reconciled and closed every month, ready for VAT, payroll and year end.
- Xero bookkeepingYour Xero file kept clean every month: bank feeds reconciled, VAT coded, MTD returns ready.
- VAT returnsQuarterly VAT returns prepared, reconciled and ready to submit under Making Tax Digital.
- Management accountsA monthly pack that shows profit, cash and performance against budget, soon after each month end.
- PayrollWhite-label payroll processing: pay runs, RTI figures and pension files prepared for your review.
- LandlordsRents and costs recorded property by property, with MTD quarterly figures ready to approve.
Talk to us about Making Tax Digital
Tell us what you need. Your message goes straight to our accountants, and we aim to reply within one business day.