Making Tax Digital for Musicians UK | The Plain English Guide (2026)

Last updated: February 2026

If you've heard the phrase "Making Tax Digital" and felt a knot in your stomach, you're not alone. Most performers I've spoken to either haven't heard of it, have heard of it but don't know what it means, or are quietly pretending it doesn't exist.

I spent the last few weeks properly looking into it so you don't have to. Here's what's actually happening, whether it affects you, and what you need to do about it.

What is Making Tax Digital?

The short version: HMRC is changing how self-employed people report their income and expenses.

Instead of doing one annual Self Assessment tax return — usually in a January panic — you'll need to keep digital records throughout the year and send summary updates to HMRC every quarter. At the end of the tax year, you'll submit a final declaration that replaces your current Self Assessment return.

This isn't new territory for HMRC. Making Tax Digital has been mandatory for VAT-registered businesses since 2019. Now it's reaching the rest of us — self-employed individuals and landlords.

The core of it is two things: digital record-keeping and quarterly updates. If that sounds like a lot, keep reading. It's less dramatic than it sounds.

Does it affect you?

It depends on how much you earn — but not in the way most performers expect.

From 6 April 2026, Making Tax Digital applies to self-employed people with gross income over £50,000. From April 2027, the threshold drops to £30,000. From April 2028, it drops again to £20,000. If you're currently earning under £20,000 gross, you're exempt for now.

Here's the part that catches people out: gross income means your total fees before expenses. Not your profit. Not your take-home after commission and mileage. Your total.

Here's a quick way to check. Grab your diary or calendar. Count how many gigs you did between April 2024 and April 2025. Multiply that by your average fee. If the number is anywhere near £50,000, MTD applies to you from April. If it's near £30,000, you're in the next wave.

A singer doing 60 gigs at £850 each has a gross income of £51,000. After 15% agency commission, mileage claims, and other expenses, the taxable profit might be closer to £30,000. But HMRC uses the gross figure — £51,000 — to decide whether MTD applies to you.

Many performers think in net terms. They know roughly what they take home. They haven't added up every fee from every agency, every direct booking, every cash-on-the-night pub gig. When they do, the total is often higher than they expected.

HMRC is basing the April 2026 threshold on your 2024/25 Self Assessment return — the tax year that ended 5 April 2025. They've already started writing to people who are above the threshold. If you received a letter, don't ignore it. If you didn't, it's still worth checking your own figures. HMRC won't always catch everyone immediately, but the responsibility to comply is yours.

What actually changes for musicians

Two things change: how you keep records, and how often you report to HMRC.

Digital record-keeping

Every gig fee, every expense, and every mileage claim needs to be recorded digitally. That means using software — not paper notebooks, not loose receipts in a carrier bag, and not a standalone spreadsheet that lives on your laptop and never connects to anything.

HMRC requires "compatible software" or a spreadsheet that's linked to bridging software for submissions. Your records need to include the date, amount, and category for every income and expense item.

If you're being honest, this is what most performers should already be doing. Keeping proper records of your income and expenses throughout the year makes tax time simpler and means you're not guessing what you earned eight months ago. MTD just makes it a legal requirement rather than a good idea.

Quarterly updates

Four times a year, you'll submit cumulative income and expense totals to HMRC. The deadlines are:

• 7 August (covering 6 April – 5 July)

• 7 November (covering 6 July – 5 October)

• 7 February (covering 6 October – 5 January)

• 7 May (covering 6 January – 5 April)

These are not four mini tax returns. They're summary figures — total income in, total expenses out, for the quarter. If your records are up to date, preparing each quarterly update should take minutes, not hours.

At the end of the tax year, you'll still do a final declaration — which replaces the current annual Self Assessment return — due by 31 January. This is where allowances, adjustments, and anything more detailed gets handled.

The quarterly updates are about keeping HMRC informed as you go. The final declaration is where the full picture comes together.

What you need to do now

Whether MTD hits you in April or not, these steps will save you time and stress.

Check your gross income. Look at your 2024/25 Self Assessment return. What's your total self-employment income — the figure before expenses are deducted? If it's over £50,000, MTD applies to you from 6 April 2026. If it's over £30,000, you're in the next wave from April 2027. If it's over £20,000, you've got until April 2028. Either way, you know where you stand.

Start keeping digital records. If you're still using paper notebooks or reconstructing your income at tax time from memory and bank statements, now is the time to get a system in place. Even if you're below the £50,000 threshold today, the bar drops to £30,000 next year and £20,000 the year after. Starting now means you'll have a full tax year of clean records when your threshold arrives.

Tools like Gigflow already keep digital records in the format MTD requires — gig-by-gig income, expenses, mileage at HMRC rates, all aligned to the UK tax year. If you're already tracking your gigs digitally, you're closer to MTD-ready than you think. Other options include accounting software like Xero, QuickBooks, FreeAgent, or untied — all of which are HMRC-recognised for MTD submissions.

Choose your software. You'll need HMRC-compatible software for submitting quarterly updates. This is where it gets important to understand the difference between record-keeping and submission. Some tools handle both. Others — including Gigflow — handle the record-keeping side, and you'd export your data to HMRC-recognised bridging software or hand it to your accountant for the actual submission.

Talk to your accountant. If you use one, ask them specifically how MTD affects their process. Most accountants are already set up for it. Some will handle the quarterly submissions on your behalf. Others will expect you to submit and send them the data at year-end. Either way, having that conversation now avoids confusion in August when the first deadline arrives.

Don't panic about penalties. HMRC has confirmed a "soft landing" for the first year. No penalty points will be issued for late quarterly updates during 2026/27. Late filing penalties use a new points-based system — you accumulate a point for each late submission, and a £200 fine only kicks in after you reach four points. But your year-end final declaration still needs to be on time, and digital record-keeping is required from day one. The soft landing is breathing room, not a free pass.

What this means for your tax return process

The annual Self Assessment return as you know it is being replaced by the MTD final declaration. Same 31 January deadline, but submitted through MTD-compatible software rather than the HMRC online portal.

If you've been keeping digital records and submitting quarterly updates throughout the year, the final declaration should be more straightforward than your current Self Assessment. Most of the data is already with HMRC. The final declaration is where you add personal allowances, make adjustments, and confirm the figures.

If you use an accountant to file your Self Assessment, talk to them now about how this changes their process. Some accountants are moving to MTD-compatible platforms and may need you to use specific software or provide data in a particular format. Better to sort that out now than in December.

For performers approaching the end of the current tax year, the advice is simple: get your 2025/26 records in order, because those records are what you'll be working from when MTD kicks in.

How Gigflow helps with MTD

If you're already using Gigflow, you're closer to MTD-ready than you think. Every gig you log — the date, fee, commission, and net pay — is a digital income record in the format HMRC requires. Your mileage calculates automatically at HMRC's approved rates (45p per mile for the first 10,000, 25p after that). Your expenses are categorised and stored digitally. Everything runs April to April, not January to December.

You don't need to think about "MTD compliance" — just keep logging your gigs, and the tax-ready records happen as a byproduct.

Gigflow doesn't currently submit quarterly updates directly to HMRC. For that step, you'd export your data to HMRC-recognised bridging software, or hand your reports to your accountant. We're working on making that connection smoother — but the record-keeping side, which is the bulk of the work, is already handled.

Frequently asked questions

Do I need Making Tax Digital if I earn under £50,000?

Not from April 2026. But the threshold drops to £30,000 in April 2027 and £20,000 in April 2028. If your gross income is anywhere near these thresholds, start preparing now. Digital record-keeping is easier to maintain than to start retrospectively.

Is gross income the same as profit?

No. Gross income is your total fees before expenses. If you earned £55,000 in gig fees but had £15,000 in expenses, your profit is £40,000 — but your gross income is £55,000, and that's what HMRC uses for the MTD threshold.

Can I still use a spreadsheet?

For record-keeping, yes — but you'll need bridging software to submit your quarterly updates to HMRC. A standalone spreadsheet on its own won't meet the requirements. The data has to flow digitally from your records to HMRC's systems.

What happens if I miss a quarterly update deadline?

You'll receive a penalty point. Once you reach four points, you get a £200 fine. But for the first year — 2026/27 — HMRC won't issue penalty points for late quarterly updates. That gives everyone time to adjust to the new system.

Do I need to sign up for MTD myself?

Yes. HMRC won't automatically enrol you. You'll need to register through GOV.UK and authorise your chosen software to connect to HMRC's systems. Your accountant can walk you through this if you're unsure.

What about cash payments at gigs?

They still count as income and must be recorded digitally. MTD doesn't change what you declare — it changes how you record and report it. If you're paid cash on the night, log it the same way you would any other gig fee.

Making Tax Digital is a significant change, but it's not as overwhelming as the headlines suggest. The quarterly updates are summary numbers. The digital record-keeping is what most performers should be doing anyway. And the soft landing in year one means there's room to get comfortable with the process.

The performers who'll find this easiest are the ones who start tracking properly now — not in August when the first deadline is looming.

Get MTD-ready without changing how you work. Try Gigflow free.