TaxFly
Self-employed / sole trader

Making Tax Digital for Income Tax

Quarterly updates, digital records, and what it means for sole traders and landlords.

7 lessons About 41 minutes By Laura Michelle Davis ✓ Reviewed by TaxFly Admin Figures for 2026/27
Making Tax Digital replaces the single annual tax return with quarterly updates and a final declaration. This course covers what actually changes, how qualifying income is measured, when the mandate reaches you, what digital records must look like, how to choose software sensibly, and how the year now closes.

By the end of this course you will be able to

  • ✓ Understand what MTD changes and what it leaves alone
  • ✓ Work out your qualifying income and whether you are in scope
  • ✓ Know what counts as compliant digital record keeping
  • ✓ Choose compatible software that matches your business
  • ✓ Run the quarterly cycle and complete a final declaration

What you will cover

Module 1

What Making Tax Digital actually is

The change, who it catches, and when it reaches you.

Making Tax Digital for Income Tax is the largest change to how sole traders and landlords report tax in a generation. It does not change what you owe. It changes how often you tell HMRC, and it removes the option of keeping your records in a shoebox and adding them up in January.

This module answers the three questions people actually have: what changes, whether it applies to me, and when. Get those right and the rest is administration.

  1. 1.1 What changes, and what does not Lesson · 6 min · includes a calculator
  2. 1.2 Working out your qualifying income Lesson · 6 min · includes a calculator
  3. 1.3 When MTD reaches you Your situation · 5 min · includes a calculator
Module 2

Getting ready

Digital records and software, in the order that actually matters.

Most MTD advice starts with software, which is the wrong end. Software is easy to change and easy to buy. The habit of recording transactions as they happen is neither, and it is the thing that decides whether MTD is a mild administrative change or a recurring crisis.

These two lessons deal with the records first and the tooling second, deliberately.

  1. 2.1 Digital records that satisfy the rules Lesson · 6 min · includes a calculator
  2. 2.2 Choosing compatible software Your situation · 6 min
Module 3

Living with it

The quarterly rhythm, and closing the year off.

Once you are in MTD, the year has a shape it did not have before: four checkpoints and a close. People who treat those checkpoints as small routine reviews find MTD unremarkable. People who treat each one as a deadline to be survived find it exhausting.

These two lessons set out the rhythm and what actually happens at the end of the year.

  1. 3.1 The quarterly update cycle Workshop · 6 min · includes a calculator
  2. 3.2 The final declaration Checkpoint · 6 min · includes a calculator

Finish with the exam

10 questions covering the whole course. Score 80% or more and you get a certificate of completion. You can retake it as many times as you like.

The exam needs a free account, so we can save your result. The lessons themselves never do.

Go to the exam
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