Research
Making Tax Digital: who it affects
Making Tax Digital for Income Tax means sole traders and landlords keep digital records and send HMRC updates through software during the year. It is coming in three waves. Here is how many people each wave reaches, and how many already use an agent or software, from HMRC's own figures.
The answer
HMRC's figures for 2023 to 2024 show 864,000 sole traders and landlords with qualifying income over £50,000 (the April 2026 wave), 1,077,000 between £30,000 and £50,000 (April 2027) and 975,000 between £20,000 and £30,000 (April 2028): 2,916,000 in all.1 Of the over-£50,000 group, 217,000 had no agent, and 172,000 had neither an agent nor software for their tax return.1
The three waves
| From | Who | People in HMRC's figures |
|---|---|---|
| 6 April 2026 | Qualifying income over £50,000 in 2024 to 2025 | 864,000 |
| 6 April 2027 | Over £30,000 in 2025 to 2026 | 1,077,000 |
| 6 April 2028 | Over £20,000 in 2026 to 2027 | 975,000 |
Qualifying income is total income from self-employment and property before expenses.3 Each wave is set by income in an earlier tax year, so the people actually brought in will differ from these 2023 to 2024 counts. HMRC's policy paper gave lower estimates, of around 780,000 for April 2026 and 970,000 for April 2027;4 we use the later statistics. A figure of 2.6 million self-employed people that appears in older coverage comes from an HMRC paper last updated in February 2022, when the planned threshold was £10,000.7
Sole traders, landlords, or both
| Qualifying income | Self-employed only | Landlords only | Both | Total |
|---|---|---|---|---|
| up to £10,000 | 1,153,000 | 1,218,000 | 58,000 | 2,429,000 |
| £10,000.01 to £20,000 | 870,000 | 712,000 | 92,000 | 1,674,000 |
| £20,000.01 to £30,000 | 637,000 | 263,000 | 75,000 | 975,000 |
| £30,000.01 to £50,000 | 798,000 | 182,000 | 97,000 | 1,077,000 |
| over £50,000 | 605,000 | 118,000 | 141,000 | 864,000 |
How many already use an agent or software
| Qualifying income | With an agent | No agent | Filed with software | No agent and no software |
|---|---|---|---|---|
| £20,000.01 to £30,000 | 59% | 401,000 | 48% | 335,000 |
| £30,000.01 to £50,000 | 63% | 400,000 | 49% | 333,000 |
| over £50,000 | 75% | 217,000 | 63% | 172,000 |
"Agent" means the person has authorised someone, such as an accountant, to deal with HMRC for them. "Software" means commercial software was used to send the end of year return.1 People in the last column handled their return themselves without software, so Making Tax Digital is the biggest change for them.
Where the April 2026 wave lives
| Region | People |
|---|---|
| London | 167,000 |
| South East | 142,000 |
| East of England | 95,000 |
| South West | 83,000 |
| North West | 68,000 |
| West Midlands | 60,000 |
| Yorkshire and The Humber | 55,000 |
| East Midlands | 53,000 |
| Scotland | 51,000 |
| Wales | 34,000 |
| Northern Ireland | 27,000 |
| North East | 22,000 |
HMRC does not publish these figures below region level.2
Which sectors
| Sector | People |
|---|---|
| Construction | 251,000 |
| Real Estate | 125,000 |
| Professional, Scientific and Technical | 77,000 |
| Wholesale and Retail Trade, Repairs | 72,000 |
| Health and Social Work | 53,000 |
| Admin and Support Services; Public Admin, Defence and Social Services | 35,000 |
| Transport and Storage | 34,000 |
| Other services activities; Households; Overseas | 34,000 |
HMRC places all landlords in real estate.2
Sign-ups so far
On 12 August 2026, HMRC said over 570,000 had signed up and more than 436,000 sole traders and landlords had sent their first quarterly update.5 From September 2026 HMRC started signing up people who must use it for 2026 to 2027 and had not signed themselves up.6 We have not found a later published figure.
What this means if you are a sole trader or landlord
If your qualifying income is over the threshold for your year, you need software that works with Making Tax Digital, and you send updates every quarter. Our guide Does Making Tax Digital affect me? covers the rules, exemptions and penalties in plain terms.
How we counted
- All counts are HMRC's, from Self Assessment returns for 2023 to 2024 received by 31 March 2025, rounded by HMRC to the nearest 1,000. Partnerships and trusts are not included.1
- We have not adjusted for people who will be exempt, or for changes in income since 2023 to 2024.
Sources
- HMRC, "Making Tax Digital for Income Tax business population statistics", tables 1 to 5 (published 13 August 2025). gov.uk. Crown copyright: "Its contents can be used as long as the source is made clear by the user."
- HMRC, "Making Tax Digital for Income Tax: industry and region management information", tables 1 and 2. gov.uk.
- GOV.UK, "Work out your qualifying income for Making Tax Digital for Income Tax". gov.uk.
- HMRC, "Making Tax Digital for Income Tax Self Assessment for sole traders and landlords" policy paper. gov.uk.
- HMRC news story, 12 August 2026: "436,000 sole traders and landlords make their tax digital". gov.uk. Checked 13 October 2026.
- GOV.UK, "Sign up for Making Tax Digital for Income Tax". gov.uk. Checked 13 October 2026.
- HMRC, "Extension of Making Tax Digital for Income Tax Self Assessment to businesses and landlords", last updated 2 February 2022. gov.uk. Checked 13 October 2026.