Quick one if you are a sole trader food van pulling in over £50,000 a year: Making Tax Digital for Income Tax properly kicks in now.
The single most misread part of this is the threshold. It is turnover, not profit. A van that took £60,000 across the season and cleared £18,000 after stock, fuel, pitch fees and everything else is in scope. Plenty of traders who assume this is a rule for bigger businesses are already inside it.
Who is in, and when
If your qualifying income topped £50,000 in the 2024/25 tax year, you are in the first wave. Qualifying income means gross income from self-employment and property combined, before expenses — so if you run the van and let a room out, the two add together.
The thresholds step down after this, which is worth knowing even if £50,000 is well above where you are now. A good season can move you into scope, and the assessment looks backwards at a tax year that has already finished.
What actually changes
Instead of one Self Assessment return in January, you send HMRC a quarterly update from software, plus a final declaration after the year end. The quarterly updates are summary figures, not a full return each time — but they do have to come out of compatible software rather than being typed in from a shoebox of receipts.
The next deadline is 7 November, covering the quarter from 6 July to 5 October.
Two things worth being clear about:
- You are not paying tax four times a year. Payment dates have not changed. This is reporting, not a new payment schedule — a lot of the panic about MTD is about a change that is not happening.
- Digital records means digital from the start. The requirement is that your income and expenses are kept digitally as you go. Reconstructing a quarter in a spreadsheet the night before the deadline is not what the rules are asking for, even if the numbers come out right.
The practical bit for a van
The record-keeping side is where food vans have both an advantage and a problem.
The advantage: if you take payment by card or QR, your income is already digital and already itemised. It reconciles itself, and it lands in software without anyone typing it. Most vans are now effectively cashless, which means the harder half of MTD is largely solved before you start.
The problem is the expenses side — the fuel receipt in the glovebox, the cash-and-carry run, the pitch fee paid in a field. That is the half that needs a habit rather than a system: photograph it when you get it, not in October.
What to do now
- Check your 2024/25 turnover against £50,000. Gross, not net.
- If you are in, sign up and pick MTD-compatible software. HMRC publishes the list of what qualifies.
- Get your income feeding into it automatically rather than by hand.
- Sort out where expense receipts go, today, before the pile builds.
- Put 7 November in the calendar, and the quarter after it.
None of this is difficult. It is just much easier done in late September than in the last week before the deadline, and the traders who get caught out are almost always the ones who left it.
Worth sorting your bookkeeping now rather than in the last week of October.