SOLE TRADERS
MTD for sole traders
Work out whether your gross sole trader turnover, combined with any property income, puts you into an MTD Income Tax phase.
Free MTD readiness checklist
Get the four-page setup guide by email.
What to know
- Qualifying income uses gross self-employment turnover before expenses, combined with gross property income.
- Employment/PAYE wages, dividends and company director salary are excluded from this test.
- Partnerships have a separate MTD timeline and are outside this checker.
Key dates
| Phase | Qualifying income | From | Tested on |
|---|---|---|---|
| 1 | Over £50,000 | 6 April 2026 | 2024/25 return |
| 2 | Over £30,000 | 6 April 2027 | 2025/26 return |
| 3 | Over £20,000 | 6 April 2028 | 2026/27 return |
MTD for sole traders FAQs
Does MTD use profit or turnover?
The qualifying-income test uses gross self-employment turnover before expenses.
Do I add rental income?
Yes. Add gross property income to gross self-employment turnover.
Does PAYE income count?
No. Employment/PAYE wages are excluded.
When does HMRC test my income?
HMRC uses the relevant previous tax year’s Self Assessment return.
Are partnerships covered?
No. Partnerships have a separate timeline and are outside this version.
Related MTD guides
Sole traders · Landlords · Thresholds · Quarterly updates · Complete guide · Start date · Who it applies to · Year-end return · £30,000 threshold