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Sole Traders: Income Tax

Asked by Euan StainbankLabourTreasuryTabled Answered 20 January 2026UIN 104880

The question

To ask the Chancellor of the Exchequer, what estimate she has made of the average compliance cost to sole traders of the transition to digital income tax in the 2026-27 financial year.

Answered by Dan Tomlinson

HMRC’s latest published assessment of the potential impact of MTD for Income Tax across different taxpayer groups is available at:

Extension of Making Tax Digital for Income Tax Self Assessment to sole traders and landlords - GOV.UK

The government has worked with stakeholders to understand costs and benefits impacts, and with the software industry to ensure a wide range of low cost and free software is available for those with the simplest affairs.

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