From 6 April 2027, sole traders and landlords with combined self-employment and property turnover above £30,000 must file quarterly returns through Making Tax Digital for Income Tax software. For this newly mandated group, Sage Sole Trader is free or £7 a month, QuickBooks Sole Trader Plus is £10 a month, and FreeAgent is £19 a month, or free if you bank with NatWest or Mettle. All three are HMRC-recognised; the right one depends on whether you have one income stream or two, and how much support you want to pay for.
Key pointers
- HMRC checks your 2025 to 2026 Self Assessment return, filed by 31 January 2027; if your combined self-employment and property turnover exceeds £30,000, you must use Making Tax Digital for Income Tax software from 6 April 2027.
- Qualifying income is gross turnover before expenses, so a landlord and a freelancer can each earn under £30,000 alone and still be pulled in once their incomes are added together.
- The £30,000 cohort gets no penalty-free grace quarter: HMRC's penalty rules waive late-submission points only for the 2026 to 2027 tax year, and this group's first year is 2027 to 2028.
- Sage Sole Trader is free for basic quarterly filing, or £7 a month plus VAT for receipt scanning, extra bank connections and live support.
- QuickBooks Sole Trader Plus costs £10 a month plus VAT and is the direct replacement for QuickBooks Self-Employed, which Intuit has retired in the UK.
- FreeAgent costs £19 a month for a sole trader or £10 a month for an unincorporated landlord (any number of properties), both plus VAT, or nothing at all if you hold a NatWest, Mettle, Royal Bank of Scotland or Ulster Bank business account.
- If you have both self-employment and rental income, ask each supplier whether one subscription reports both: FreeAgent needs a separate account for each income stream.
- Check your 2025-26 figures now rather than waiting for HMRC's letter; if you're close to £30,000, signing up voluntarily gives you a year of quarterly reporting practice before it becomes compulsory.
What the £30,000 Threshold Means for Sole Traders and Landlords
Making Tax Digital for Income Tax replaces the annual Self Assessment return with digital record-keeping and four quarterly summaries a year, followed by a final declaration. It started for the highest earners first: anyone with qualifying income above £50,000 in the 2024-25 tax year had to join from 6 April 2026. The next phase brings in anyone above £30,000, tested against the 2025-26 tax year and starting 6 April 2027. A third phase, at £20,000, follows in April 2028.
The trap for this cohort is how qualifying income is calculated. HMRC adds your gross self-employment turnover to your gross property income, before you deduct a single expense, and tests the total against £30,000. HMRC's own worked example shows a landlord with £25,000 of rental income and £27,000 of self-employment income being assessed on a combined £52,000, even though neither figure alone might look mandating. As an illustrative case with invented numbers: a hypothetical sole trader earning £22,000 from freelance work and £9,000 in gross rent from a single flat has combined qualifying income of £31,000, over the £30,000 line, even though neither income on its own would be. Anyone with a side letting on top of self-employed work, or a full-time job's worth of freelance income alongside a modest rental, should add both figures together before assuming they're safe.
Once you're mandated, you don't get to step straight back out. HMRC's guidance on qualifying income confirms you stay inside Making Tax Digital for Income Tax until your qualifying income has sat below the relevant threshold for three consecutive tax years. Because the thresholds keep falling, from £50,000 to £30,000 to £20,000, that bar gets harder to clear each year, so budget for this as an ongoing cost rather than a one-off migration.
UK Compliance Mapping
Making Tax Digital for Income Tax is a statutory HMRC reporting requirement, not a vendor recommendation. Once your qualifying income crosses £30,000 on your 2025-26 return, keeping digital records and filing quarterly updates through HMRC-recognised software is mandatory, and the penalty regime that applies to late submissions and late payments is set out in HMRC guidance rather than left to individual software providers.
The detail most worth flagging for this specific cohort: HMRC's guidance states there are no penalties for missing a quarterly update deadline for the 2026-27 tax year specifically, and that penalty points apply to quarterly updates "for tax years after 2026 to 2027". The £30,000 group's first mandated tax year is 2027-28, which falls after that cut-off, so unlike the earlier £50,000 cohort's first year, this group has no penalty-free run-in period for quarterly filing. Digitally excluded individuals may qualify for an exemption, but everyone else should assume the points-based penalties apply from their very first quarter. This is not legal advice; consult your legal counsel or accountant about how these rules apply to your specific circumstances.
How Quarterly Reporting Actually Works
The mechanics are the same whichever software you choose. You (or your bookkeeper) record income and expenses digitally throughout the quarter, ideally through a connected bank feed rather than manual entry. Before each of the four deadlines, the software totals your income and expenses for that quarter and submits the summary to HMRC's systems directly, using your Government Gateway credentials to authorise the connection. At the end of the tax year, instead of a Self Assessment return you submit a final declaration, which finalises your income, applies any allowances, and confirms your tax bill. Your accountant, if you have one, can be given access to review or submit on your behalf, but the legal responsibility for accurate, timely submissions stays with you.
Pricing and Cost Model
Prices below are the entry-level plans aimed at non-VAT-registered sole traders and landlords, which is the relevant tier for most people crossing the £30,000 line (the VAT registration threshold is separately set at £90,000). All three vendors quote prices excluding 20% VAT, so add a fifth again to each figure for what actually leaves your account.
| Software | Entry plan | Monthly price (excl. VAT) | Price including VAT | Free route |
|---|---|---|---|---|
| Sage Sole Trader | Free tier / paid tier | £0, or £7 | £0, or £8.40 | Free tier always available |
| QuickBooks Sole Trader Plus | Sole Trader Plus | £10 | £12 | 30-day free trial only |
| FreeAgent (sole trader) | Sole trader plan | £19 | £22.80 | Free with NatWest, Mettle, RBS or Ulster Bank |
| FreeAgent (unincorporated landlord) | Landlord plan | £10 | £12 | Free with NatWest, Mettle, RBS or Ulster Bank |
FreeAgent and QuickBooks both run promotional pricing: FreeAgent offers 50% off for the first six months on either plan, and QuickBooks was showing 90% off for six months on its UK pricing page at the time of writing, which is a limited-time offer rather than a permanent price, so budget from the standard monthly rate, not the promotional one. QuickBooks currently has no annual billing option on its UK pricing page. FreeAgent does: paying annually for the sole trader plan brings the regular rate down to £190 a year (£15.83 a month) against £228 a year (£19 a month) if you pay monthly, and FreeAgent's separate first-year promotion then halves that annual rate to £95 for new customers.
None of these figures include the cost of your own time keeping records through the year, or an accountant's fee if you use one to review or file your final declaration. Sage's free tier caps you at five sales invoices a month, so a busier sole trader will likely need the paid tier regardless of the headline "free" price.
Vendor and Option Comparison
| Sage Sole Trader | QuickBooks Sole Trader Plus | FreeAgent | |
|---|---|---|---|
| Best for | Straightforward affairs on a tight budget | A low-cost paid plan with wider QuickBooks ecosystem support | Landlords and sole traders who want dedicated UK-based support, or already bank with NatWest Group |
| Standard price | Free, or £7/month + VAT | £10/month + VAT | £19/month (sole trader) or £10/month (landlord), + VAT |
| Free route | Free tier built in | 30-day trial only | Free with NatWest, Mettle, RBS or Ulster Bank business account |
| Quarterly MTD filing | Included, HMRC-recognised | Included, HMRC-recognised | Included, HMRC-recognised, with auto-populated updates from a bank feed |
| Sales invoices | 5 a month on the free tier, unlimited on the paid tier | Capped per plan; check the current published limit before you buy | Not capped on the published plan details |
| Multiple income streams | Not confirmed in published detail; ask before buying | Vendor states support for "single and multi-income types" | Needs a separate account per income stream (self-employment and property are billed and filed separately) |
| Support | UK-based phone/webchat on the paid tier | Phone and chat support included | UK-based accountant-staffed support team |
| Watch out for | Free tier's invoice cap and lighter feature set | The product used to trade as QuickBooks Self-Employed; expect a migration step if you're an existing customer | Two-account rule doubles the cost for anyone with both self-employment and rental income who doesn't qualify for the free route |
None of the three is a universal winner. If your affairs are simple and you're comfortable with a five-invoice monthly cap, Sage's free tier gets you compliant at no cost. If you send more invoices than that and want a single low-cost paid plan, QuickBooks Sole Trader Plus is the cheapest paid option at £10 a month, though you should check its current published invoice limit against how many you actually send. If you want UK-based human support and can get it free through your bank, FreeAgent via NatWest or Mettle is hard to beat, but check the two-account rule first if you have both a trade and a rental property, since it can turn a free deal into two separate subscriptions.
Keeping your current spreadsheet is not an option once you're mandated. Spreadsheets can still hold your records if paired with separate HMRC-recognised bridging software to file the quarterly summaries, but that is a narrower, more manual route than any of the three products compared here, and worth raising with your accountant if you'd rather not change how you keep records at all.
Editorial analysis
The honest answer for most people newly caught by the £30,000 line is to pick the option that matches your banking and your income shape before you compare features in detail. If you already hold a NatWest, Mettle, Royal Bank of Scotland or Ulster Bank business account, FreeAgent's free offer removes price from the decision entirely, provided you're not paying twice for having both self-employment and rental income. If you don't bank with NatWest Group and your affairs are simple, Sage's free tier is the cheapest way into compliance, and the £7 upgrade is inexpensive if the five-invoice cap turns out to bite. QuickBooks Sole Trader Plus sits in between: a modest £10 a month buys a product from a large, well-integrated ecosystem, useful if you expect to outgrow a single-income sole trader setup and want the option to step up to a VAT-registered plan later without switching providers.
What we'd avoid is choosing on brand recognition alone. QuickBooks Self-Employed and Sage Individual, the two products many people will search for by name, have both been retired and rebranded, so the product you sign up for today may not be the one older reviews describe. Read each vendor's current MTD for Income Tax page rather than a two-year-old comparison, and if you run both a trade and a let property, get a straight answer from the supplier on whether one subscription covers both before you commit.
Sources
- Find out if and when you need to use Making Tax Digital for Income Tax - HM Revenue & Customs, last updated 26 March 2026, accessed 29 September 2026.
- Work out your qualifying income for Making Tax Digital for Income Tax - HM Revenue & Customs, accessed 29 September 2026.
- Penalties for Making Tax Digital for Income Tax - HM Revenue & Customs, last updated 30 March 2026, accessed 29 September 2026.
- FreeAgent pricing - FreeAgent Central Ltd, accessed 29 September 2026.
- Get MTD done with FreeAgent - FreeAgent Central Ltd, accessed 29 September 2026.
- Free accounting software for your business - FreeAgent Central Ltd, accessed 29 September 2026.
- Switch from QuickBooks Self-Employed to QuickBooks Online or Sole Trader Plus - Intuit QuickBooks UK, updated 5 August 2026, accessed 29 September 2026.
- Accounting software for sole traders - Intuit QuickBooks UK, accessed 29 September 2026.
- Making Tax Digital for Income Tax - Intuit QuickBooks UK, accessed 29 September 2026.
- Sage Sole Trader - Sage Group plc, accessed 29 September 2026.
- QuickBooks UK Review 2026 - Office Software Marketplace, pricing re-verified 28 August 2026, accessed 29 September 2026.
- Your 2026/27 MTD ITSA Deadline Calendar: Every Date That Matters - GM Professional Accountants, published 23 July 2026, accessed 29 September 2026.
- Sage 50 vs QuickBooks Online vs FreeAgent for UK Sole Traders and Micro-Businesses Doing Self Assessment - Compare the Cloud, published 27 February 2026.
