MTD with more than one income source: sole trader, landlord or both
Short answer: HMRC adds all your self-employment and property income together to decide if you must use Making Tax Digital for Income Tax. Once you are in, you send a separate quarterly update for each self-employment business and each type of property income. A sole trader with UK rental income therefore sends 2 updates per quarter, 8 a year, then one final declaration for everything.
Not sure whether you are over the threshold? Use the MTD checker.
How the threshold works with several sources
The threshold looks at your total qualifying income, not each source on its own. GOV.UK says your total income may come from more than one source of self-employment or property income, and gives the example of £25,000 of rent plus £27,000 of self-employment, which makes £52,000.
Qualifying income is gross, before expenses. For the main phases, see MTD from April 2027 and what counts as qualifying income.
A few details from GOV.UK that matter when you have a mix of income:
- Two or more sole trader businesses: turnover from all of them is added together.
- UK property and foreign property: both count if you were UK tax resident in the year HMRC tests. If you were not UK tax resident, only UK property counts.
- Employment income does not count towards the threshold. Neither does your share of profit as an individual partner in a partnership.
- Self-employment or property income that a partnership tells you about, in your own right, does count.
How many quarterly updates you send
GOV.UK says you send quarterly updates for each self-employment and property business you have, and each update shows that business’s total income and expenses for the tax year so far.
What counts as one business:
| Income | How it is treated |
|---|---|
| Each self-employment business | Its own digital records and its own update |
| All UK properties together | One UK property business, one update |
| All foreign properties together | One foreign property business, one update (keep a record for each property) |
| Employment, pensions, dividends | No quarterly update |
GOV.UK’s example is an electrician who also teaches driving: one set of records and one set of updates for each business.
So the sums are simple:
| Your income | Updates per quarter | Updates per year |
|---|---|---|
| One business | 1 | 4 |
| Business plus UK rent | 2 | 8 |
| Two businesses plus UK rent | 3 | 12 |
| Business, UK rent and foreign property | 3 | 12 |
If you jointly let a property, GOV.UK lets you choose to send property income only or income and expenses for the jointly let property. See MTD for jointly owned property.
Simpler expenses apply to each source
Each source can use a single total for expenses instead of full categories if its turnover is under £90,000. GOV.UK says the self-employment test is turnover from a source of self-employment, and the property test is total UK property turnover. It says the threshold does not apply to foreign property income.
So a hairdresser with £24,000 turnover and £12,000 of rent can use simpler expenses for both. If one source reaches £90,000, GOV.UK says you must categorise all records for that source in full, including those from earlier in the tax year.
GOV.UK also words this limit as turnover below the VAT threshold, and with more than one source, each one must be below it. Details of the categories are in what goes in an MTD quarterly update.
Worked example for 2027-28
Example: Alex, a hairdresser and landlord. In 2025-26 Alex had £24,000 of hairdressing turnover and £12,000 of rent from one flat. Qualifying income is £36,000, over £30,000, so Alex must use MTD from 6 April 2027. Alex keeps standard quarters, and has two income sources: self-employment and UK property. These figures are made up.
Each update is cumulative from 6 April 2027. Alex sends two per deadline, one for each source.
| Update period (from 6 April 2027) | Deadline | Hairdressing | UK property |
|---|---|---|---|
| To 5 July 2027 | 7 August 2027 | Update 1 | Update 1 |
| To 5 October 2027 | 7 November 2027 | Update 2 | Update 2 |
| To 5 January 2028 | 7 February 2028 | Update 3 | Update 3 |
| To 5 April 2028 | 7 May 2028 | Update 4 | Update 4 |
| Whole 2027-28 tax year | 31 January 2029 | One final declaration |
That is 8 quarterly updates in total. The second hairdressing update shows income and expenses from 6 April to 5 October, not just the new quarter. See cumulative quarterly updates. Calendar quarters have the same deadlines but different period end dates. See MTD deadlines.
Alex’s turnover is under £90,000 for each source, so each update can show a single total for expenses.
The final declaration covers everything
After the fourth updates, you make one final declaration for the year. GOV.UK says you must submit your tax return by 31 January after the end of the tax year, and that you must add all income sources and gains before declaring your information is correct and complete.
That includes income with no quarterly update. HMRC adds some income itself, such as employment (PAYE) and pensions, but GOV.UK says you must check it before you submit. If Alex also had a part-time job, it would not need a quarterly update and would not count towards the threshold, but it would be in the final declaration. For more on this step, see the final declaration.
Partnerships
GOV.UK says partnerships will need to use MTD for Income Tax in the future, with the timeline to be set out later. Your share of partnership profit as an individual partner does not count towards the threshold. If you are a sole trader and also a partner, only the sole trade counts for now, and the partnership share still goes on your tax return as usual. If you may be exempt, see MTD exemptions.
Keeping it manageable
The practical issue with several sources is keeping the records apart. Each business needs its own digital records, so a single mixed bank account makes the work harder. Tools like SendMTD are being built to read a bank statement CSV and prepare totals for each source. It is not live yet and is not HMRC recognised. See software options.
Sources
This guide is general information, not tax or legal advice. Rules can change: check GOV.UK or speak to an accountant about your situation. SendMTD is not affiliated with HMRC.