Making Tax Digital for Income Tax presents challenges for businesses but you’re not alone, and help is available. The post Sage x Checkatrade: Why Making Tax Digital for Income Tax is cutting admin for sole traders appeared first on Sage Advice UK.
Sage x Checkatrade: Why Making Tax Digital for Income Tax is cutting admin for sole traders
56% of the UK private sector is made up entirely of sole traders, yet many still face significant administrative burdens when it comes to operating their business.
If you’re a sole trader, spending hours every week wrestling with your tax and finance admin is not where you want to be.
The good news is that Making Tax Digital for Income Tax lands in April, and it’s designed to combat exactly this.
That’s what we talk about in this blog, based on wisdom shared at the recent event Backing Britain’s Small Businesses: Digital Tools for Growth, as follows:
MTD is enabled by AI, automation, and e-invoicing
A reminder: Making Tax Digital for Income Tax takes effect in April 2026 and effects sole traders or landlords currently using Self Assessment and earning over £50,000.
If affected, you must submit quarterly updates via MTD-ready software, and a digital tax return on 31 January each year.
AI, automation, and e-invoicing are transforming how businesses operate. They’re no longer future concepts; they’re practical solutions that can help you to drastically reduce admin whilst remaining compliant.
And with MTD for Income tax creating new ways of working, there has never been a better time to embrace this shift.
That’s why, last week, Sage partnered with Checkatrade to host Backing Britain’s Small Businesses: Digital Tools for Growth, a Parliamentary Reception at the House of Commons. Catch up on everything you missed from the event, below.
Uniting MPs, policymakers, sole traders, accountants, bookkeepers, and business leaders, the event spotlighted the vital role of digital tools in helping businesses to grow ahead of MTD for Income Tax and beyond.
3 key takeaways for sole traders and landlords
Interested in learning more about how digital tools can support your business growth ahead of MTD for Income Tax?
Keep reading to discover three key takeaways from the day.
1. Making Tax Digital for Income Tax reduces the admin burden
For many sole traders, the admin side of running a business still takes up far too much time. Hours each week are often lost managing taxes with methods that make the process harder than it needs to be.
Research shows that around 66% of sole traders still rely on spreadsheets to manage their taxes, while another 33% use entirely manual pen and paper calculations. During the event it was clear that those shifting to digital tools were already feeling the difference.
Their experiences showed that Making Tax Digital for Income Tax doesn’t have to feel like more paperwork. The right tools can make it feel like taking real control of your finances.
“Technology has made things a lot quicker and easier for me,” said Chris Jaxson from Jaxson Plastering. “As a sole trader, I’m often working 6–7 days a week, so having the ability to do things digitally and on my phone has made it a lot easier.”
Accountant Faith Mupakaviri stressed the benefits of going digital: “The time to adopt is now, and leaning on software like Sage frees up your time to do more of what you love, more for your business, and get more of your free time back”.
2. Digital tools will reduce errors and save you hours every week
The same research mentioned earlier reports that over half of small businesses say software helps them stay organised and clear on their finances.
Embracing tools to help navigate through MTD for Income Tax comes with a host of benefits to your business, including:
- Fewer errors: Digital records and software have minimised manual data entry mistakes.
- Better record‑keeping: Business financial information is stored securely in one place and can be easily updated.
- Time savings: Automation drastically reduces repetitive admin tasks, freeing your time for more valuable work.
- Real time tax visibility: Businesses are benefiting from a real time view into their tax position throughout the year instead of waiting until year-end.
- Future‑proofing: Transitioning won’t just help you now, it prepares you for ongoing digital tax changes coming from HMRC.
Many of those impacted by MTD for Income Tax are worried that going digital might mean expensive software and a steep learning curve. The reality is the opposite.
Solutions like Sage Individual are designed for people who’d rather be doing the work they love, rather than spending hours navigating tricky software. And the beauty is, it’s completely free.
Ready to make your business MTD ready?
Discover how Sage Individual, our accounting software for self-employed sole traders, helps you get MTD-ready.
Embracing technology now could transform what feels like a regulatory challenge into an opportunity for efficiency and growth.
The shift isn’t about replacing your human expertise; it’s about amplifying it and freeing up your time to do more of what you love.
It’s vital that we do right by our businesses in the UK, and supporting small businesses and sole traders with AI tools and digital tools is an important part of that.
Emma Grant, Head of Trade Engagement, Checkatrade
3. The future of British businesses is bright
Throughout the event one message rang clear: small businesses are the backbone of Britain.
Looking to the future, Samantha Niblett MP spoke passionately about how digital and AI tools offer an exciting opportunity to level the playing field so that small businesses “feel empowered and can focus on championing economic growth in their own areas”.
This message was echoed by the Minister responsible for Making Tax Digital, Dan Tomlinson MP, who emphasised the importance of easing admin burdens for small businesses:
“Every day we hear the challenges that you face, whether it’s managing cash flow, staying compliant or finding time to focus on economic growth. Digitalisation is the answer to many of these challenges”.
If there’s one thing this event made clear, it’s that near future for British businesses won’t be defined by legislation alone.
Final thoughts: MTD is a new era
With the right digital tools and the right backing from businesses like Sage and Checkatrade alongside the commitment of policymakers, the UK’s entrepreneurs are stepping into a new era of transformation.
2026 is already proving that digitisation is opening more possibilities for sole traders and small businesses in the UK.
Are you a sole trader preparing for MTD for Income Tax? Start MTD with Sage and connect your bank feed to be in for a chance of winning £25,000 to cover your tax bill.
Win £25,000 to cover your tax bill
Sole trader? Just follow our three simple steps to get yourself ready for MTD, and you’re in with a chance of winning!
The post Sage x Checkatrade: Why Making Tax Digital for Income Tax is cutting admin for sole traders appeared first on Sage Advice UK.
