Quick answer
Making Tax Digital for Income Tax started on 6 April 2026 for sole traders and landlords with qualifying income over £50,000. It extends to income over £30,000 in April 2027 and over £20,000 in April 2028. FreeAgent and Xero both list MTD support. Dates checked 11 November 2026 on GOV.UK.
How we compared: every price and plan limit on this page was read from the vendor’s own UK page on 11 November 2026, and tax dates come from GOV.UK. We have not run hands-on tests of these products for this article, so we do not describe how they feel to use. This is general information, not tax or financial advice. See our editorial policy.
When does Making Tax Digital for Income Tax apply to you?
GOV.UK sets three start dates, based on qualifying income. Qualifying income is gross income from self-employment and property, before any tax allowances or expenses are deducted.
| Start | Qualifying income | Status on 11 November 2026 |
|---|---|---|
| 6 April 2026 | Over £50,000 | Already started |
| 6 April 2027 | Over £30,000 | About 5 months away |
| 6 April 2028 | Over £20,000 | About 17 months away |
Xero’s page adds that people below £20,000 can continue using Self Assessment, that the first quarterly update fell due by 7 August 2026, and that the final declaration is due by 31 January.
What software do sole traders need?
You need software that is compatible with HMRC’s service to keep digital records and send quarterly updates. The two UK tools we have verified so far are below. HMRC also publishes a list of compatible software, which we have not reviewed here.
| Best for | Software | From (per month) |
|---|---|---|
| Free if you bank with NatWest, RBS or Ulster Bank | FreeAgent | £0 with those accounts, otherwise £19 |
| Lowest paid plan listed MTD for Income Tax ready | Xero Ignite | £18 |
| Higher invoice limits | Xero Grow | £39 |
| Software | MTD support listed | Price per month (excluding VAT) | Free route |
|---|---|---|---|
| FreeAgent (sole trader) | Making Tax Digital in its feature table | £19, or £190 a year | NatWest, RBS, Ulster Bank; Mettle with one transaction a month |
| Xero Ignite | MTD for Income Tax ready | £18 | None listed |
| Xero Grow | MTD for Income Tax ready | £39 | None listed |
| Xero Comprehensive | MTD for Income Tax ready | £55 | None listed |
Is there free MTD software?
FreeAgent’s page lists it as free with NatWest, Royal Bank of Scotland and Ulster Bank business accounts for as long as you keep the account, and with Mettle if you process at least one transaction a month. Other tools advertise free plans, but we have not verified them, so we do not list them here. Read our FreeAgent pricing guide for the cost if you do not bank with those providers.
What should you do before April 2027?
- Check whether your gross self-employment and property income is over £30,000. If it is, you may need to be ready from 6 April 2027.
- Pick software and run it alongside your current records for a few weeks.
- Check your HMRC online account for the dates that apply to you.
- Tell your accountant which software you use, so they can see the same data.
Compare prices for each tool in our Xero pricing guide and FreeAgent pricing guide.
Frequently asked questions
When does Making Tax Digital for Income Tax start for sole traders?
GOV.UK says it starts in April 2026 for sole traders and landlords with qualifying income over £50,000, extends to over £30,000 from April 2027 and over £20,000 from April 2028. Qualifying income is gross income before allowances and expenses.
What counts as qualifying income?
GOV.UK says qualifying income includes gross income from self-employment and property before any tax allowances or expenses are deducted. Check HMRC’s guidance for which tax year’s income decides when you join.
Do I need software for Making Tax Digital for Income Tax?
You need software that is compatible with HMRC’s Making Tax Digital service to send the updates. Xero and FreeAgent both list MTD support on their pages. HMRC publishes a list of compatible software that we have not reviewed.
Is there free MTD software for sole traders?
FreeAgent’s page lists it as free for customers of NatWest, Royal Bank of Scotland and Ulster Bank business accounts, and for Mettle accounts with one transaction a month. Other free options exist, but we have not verified them.
What happens below £20,000 of income?
Xero’s page says people below £20,000 can continue using Self Assessment. Check GOV.UK for the latest position, because the thresholds are due to change in April 2027 and April 2028.
When is the first quarterly update due?
Xero’s MTD page says the first quarterly update was due by 7 August 2026, with the final declaration by 31 January. Your own dates depend on when you join, so confirm in your HMRC online account.
Update log: 11 November 2026. Prices and plan limits read from the vendors’ own UK pages and HMRC dates from GOV.UK. Next check: December 2026.
Sources: GOV.UK: one year until Making Tax Digital for Income Tax launches, Xero: Making Tax Digital for Income Tax, FreeAgent, Xero UK plans. Checked 11 November 2026.