From April 2026, 1.7 million sole traders and landlords with turnover above £30,000 will be forced into quarterly Making Tax Digital for Income Tax Self Assessment (MTD ITSA). That means four detailed submissions a year plus a final end-of-year return – all via approved software most have never used.
HMRC admits 62 % of affected sole traders will need to hire an accountant or bookkeeper just to comply, adding £1,200–£2,400 to annual costs. A self-employed plumber in Leeds told us he 
already spends 12 hours a week on paperwork; MTD will double that. Thousands say they will simply shut up shop rather than face the burden.
The penalty regime is brutal: £100 late submission fee per return, then daily penalties after three months. Miss one quarterly update and you’re looking at £700+ in fines before you even file your tax return.
This is not about catching tax evaders; it is about drowning ordinary tradespeople in red tape. Australia delayed its equivalent scheme twice because of small-business backlash. Britain is charging ahead regardless.
We demand three simple safeguards:
- Raise the MTD ITSA threshold to £50,000 turnover – exempting 600,000 of the smallest traders at a cost of just £40 million in lost compliance.
- Scrap all late-submission penalty points and fines for the first two years of the scheme while people get to grips with the software.
- Provide a £500 one-off digital transition grant for every affected sole trader to buy software and training.
Total cost: £380 million – a fraction of the £8 billion HMRC has already spent building the system.
Give sole traders breathing space instead of bankruptcy notices.
The 1832 Club is fighting for these changes. The more members we have, the louder our voice in Westminster.
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