If you are a sole trader moving to the UK, or continuing your self-employed business after relocating, the UK tax system may feel unfamiliar—particularly with the introduction of new digital reporting rules.
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is a significant change in how sole traders must report their income to HMRC. From April 2026, many self-employed individuals will need to keep digital records and submit quarterly income updates through approved software.
Our team specialises in supporting overseas individuals trading as sole traders in the UK. We provide a complete service package including bookkeeping, quarterly submissions, and MTD-compliant software—giving you everything you need to meet your digital tax obligations with confidence.
MTD is a UK government initiative to modernise the tax system by replacing paper-based or once-a-year returns with digital record-keeping and quarterly submissions.
Instead of filing one annual tax return, you’ll need to:
| Annual Gross Income | Date MTD Becomes Mandatory |
|---|---|
| Over GBP 50,000 | 6 April 2026 |
| Over GBP 30,000 | 6 April 2027 |
| Over GBP 20,000 (expected) | 6 April 2028 |
Important: MTD applies based on your turnover (gross income), not your profit. If your total income from UK self-employment and/or property exceeds the threshold, you must comply.
To be ready for MTD, you will need to:
Although Making Tax Digital (MTD) changes how income is reported, the way you pay your tax remains the same.
As a sole trader, you usually pay income tax in three instalments each year:
Example: For the 2024/25 tax year (ending 5 April 2025), your first payment on account would be due 31 January 2025, your second on 31 July 2025, and the balancing payment on 31 January 2026.
Your payments are based on the total tax due for the year, including Class 2 and Class 4 National Insurance contributions if applicable.
We’ll help you calculate what’s due and make sure nothing is missed.
We’ve invested in MTD-compliant accounting software and trained our team to support sole traders with all aspects of digital compliance. Our services include:
We understand that the UK tax system can be confusing—especially if English isn’t your first language or you’re unfamiliar with local rules. That’s why we explain everything clearly and handle the practical steps on your behalf.
Although MTD for Income Tax won’t apply to everyone right away, it’s important to prepare early. Using MTD software now will help you transition smoothly and avoid any last-minute stress when the new rules apply.
It’s a new system from HMRC requiring sole traders to keep digital records and submit tax information quarterly using special software.
Yes, if your UK income from self-employment exceeds the relevant threshold (GBP 50,000 from April 2026, GBP 30,000 from April 2027). Even if you are new to the UK, these rules will apply based on your turnover.
Only if the spreadsheet is linked to MTD-compatible software. HMRC will not accept manual spreadsheets or paper-based records.
No, MTD changes how you report your income, not how you pay your tax. As a sole trader, you’ll normally pay your income tax and National Insurance in three parts:
We’ll help you keep track of what’s due and when, so you avoid unexpected bills or penalties.
We handle this for you. Our bookkeeping team uses MTD-compliant software and can manage your records, submissions, and deadlines on your behalf.
You’re not legally required to have an accountant in the UK, but we highly recommend it. The UK tax system is complex and likely very different from what you’re used to in your home country.
If you’re earning income in both countries, you may still need to keep your existing accountant to handle your home country tax affairs. At the same time, a UK-based accountant will help you meet your UK obligations, avoid double taxation, and ensure you make full use of any applicable double tax treaties.
We work exclusively with clients from overseas and understand how to manage the interaction between UK and foreign tax systems. Let us guide you through what’s required and help you stay compliant in both jurisdictions.
MTD is not yet mandatory for you, but using digital software is still good practice—and will likely become compulsory in future.
If your combined income from self-employment and UK property exceeds the threshold, MTD will apply. We have a separate page for landlords – see our guide.
We offer a free initial consultation with no obligation. If you’re unsure whether MTD applies to you, or you’d like help getting started, our team is here to support you every step of the way.
Contact us today for a tailored quote or free initial advice.
Senior Manager
Head of Direct Taxes
Senior Associate
Global Mobility, Personal Tax & VAT
