Thousands of sole traders and landlords in the South West are facing new tax obligations.
The 83,000 sole traders and landlords in the region, with a turnover of more than £50,000 from self-employment and property, will need to comply with HMRC’s Making Tax Digital (MTD) for income tax from Monday, April 6.
Under the new rules, affected individuals will be required to keep digital records and use compatible software to send four quarterly updates on income and expenses to HMRC.
Craig Ogilvie, director of MTD at HMRC, said: "MTD for Income Tax is a generational change and support is there for everyone who needs it.
"The quarterly updates aren’t tax returns – they’re simple summaries your software auto-populates, spreading the admin throughout the year, rather than leaving it all towards the January self assessment deadline.
"Go to gov.uk – choose your software, read the guidance and get ready now."
HMRC estimates that in the South West, around 57,000 sole traders and 11,000 landlords will be required to use MTD in the 2026 to 2027 tax year, with a further 15,000 falling into both categories.
Most of those affected will receive a letter from HMRC explaining what they need to do, including a QR code linking to gov.uk guidance.
So far, around 100,000 sole traders and landlords have already registered for MTD for income tax, with more than 15,000 quarterly updates submitted through a voluntary testing programme.
The first quarterly update under MTD will cover the period from Monday, April 6 to Sunday, July 5, and must be submitted by Friday, August 7.
A new points-based penalty system for late submissions will apply.
A £200 fine will only be triggered after four points are accumulated, meaning one-off delays will not lead to an immediate penalty.
However, for the 2026 to 2027 tax year, no penalty points will be issued for late quarterly updates, though points will still apply to late tax returns.
Those in scope for MTD for income tax can find step-by-step guidance, software options, and sign-up instructions on the gov.uk website.
HMRC research shows that 99.6 per cent of agents are already aware of the upcoming changes and is strongly encouraging affected individuals to begin preparing now by choosing compatible software and starting to keep digital records.
Free and paid software options are available.
Those unable to use digital tools due to age, disability, or other reasons may apply for an exemption.
Anyone with a tax agent is advised to discuss preparation with them as soon as possible.
Share