MTD 2026: A Sole Trader’s Guide to Making Tax Digital

If you’re a sole trader, April 2026 is going to change everything. Not in a small, “meh, we’ll cope” way, but in a big, shake-up-your-accounting workflow kind of way. The UK government’s Making Tax Digital (MTD) rules mean quarterly income tax submissions are no longer optional - they’re mandatory.

But here’s the good news: you don’t have to panic. Pocket Angel can help you go fully digital, from bookkeeping to quarterly submissions and beyond, so you stay compliant, organised, and stress-free.

Understanding Making Tax Digital (MTD) for Income Tax

From April 2026, most sole traders and landlords above the qualifying income threshold will need to submit quarterly income and expense summaries digitally. This isn’t just a minor tweak - it’s a complete overhaul of how self-employed individuals report taxes.

Previously, self-assessment let you file once a year. MTD requires:

• Keeping digital records

• Submitting quarterly summaries to HMRC

• Filing a final annual declaration

• 
  

The aim? More accurate reporting and fewer last-minute panics at tax time. But it also means you can’t rely on spreadsheets alone, unless you use bridging software compatible with MTD.

Why This Is the Biggest Income Tax Shake-Up in 30 Years

MTD fundamentally changes the rhythm of tax compliance:

• Quarterly reporting replaces annual-only submissions - you’ll need to keep digital records consistently throughout the year

• Penalties and fines are stricter - late or incorrect submissions can carry points-based penalties

• Digital-first compliance is mandatory - HMRC will no longer accept “manual” self-assessment methods

• 
  

It’s a lot to take in, and we’re hearing from sole traders across the UK that the thought of MTD is stressful. But done right, it’s manageable - and can actually make your business smoother and more organised.

How Pocket Angel Supports MTD Compliance

Here’s where we come in. Pocket Angel doesn’t just tell you “go digital for MTD” we help you implement it. And whilst you're at it, go digital with everything!

• Streamline your entire business instead of juggling multiple apps, notebooks, spreadsheets, and software that don’t talk to each other.

• Replace 10 different tools with one simple, centralised system - Pocket Angel keeps your admin, tasks, clients, notes, and calendar together.

• Get set up with MTD-compatible software properly from the start - no guessing, no stress.

• Keep your records tidy all year with digital bookkeeping, receipt storing, and income/expense tracking.

• Stay ahead of deadlines with automatic reminders and quarterly update support.

• Make your final declaration easy because everything is already organised, checked, and ready to go.

Practical Steps Sole Traders Should Take Now

1. Check if you’re affected: Use HMRC guidance to see if your income triggers MTD.

2. Choose MTD-compatible software: Research options or let Pocket Angel advise.

3. Digitise your records now: Start tracking expenses digitally today - early adoption makes the transition painless.

4. Set up workflows & reminders: Pocket Angel can automate recurring tasks, from bookkeeping to quarterly summaries.

5. Plan for quarterly submissions & final declaration: Map out deadlines for 2026 so nothing sneaks up on you.

   
   

MTD Doesn’t Have to Be Scary

Going digital isn’t just about compliance. It’s an opportunity to:

• Keep your finances organised

• Save time on admin

• Reduce stress at year-end

• Understand your business performance better

With Pocket Angel supporting you, MTD can become just another part of your smooth, digital business workflow - not a source of panic.