Making Tax Digital for childminders: what's changing in April 2026

TL;DR: Making Tax Digital for Income Tax (MTD ITSA) hits self-employed UK childminders in three waves, based on qualifying income from self-employment and/or property: over £50,000 from 6 April 2026, over £30,000 from 6 April 2027, over £20,000 from 6 April 2028. Three things change for your business: digital records (the paper diary alone is no longer compliant), four quarterly summary submissions per tax year (plus the year-end declaration you already do), and a piece of HMRC-compatible filing software to handle the submissions. The work itself is small, about ten minutes a quarter once your records are in shape. The shift is the rhythm: from a once-a-year January scramble to a four-times-a-year discipline.

If you're a self-employed UK childminder, the headline news is short. MTD ITSA becomes mandatory in three steps, based on qualifying income from self-employment and/or property:

• From 6 April 2026 — qualifying income over £50,000.
• From 6 April 2027 — qualifying income over £30,000.
• From 6 April 2028 — qualifying income over £20,000.

That will catch many established childminders running full-week books, especially those topping up with school pick-ups, holiday clubs, or older-child after-school slots. If you also rent out a property, that rental income counts toward the same threshold.

The three real changes:

1. Digital records, not paper. Income and expenses captured in a structured digital form. A spreadsheet can work, but only if it pairs with MTD-compatible bridging software for the actual submissions. Cloud accounting software does both jobs natively. The paper diary plus shoebox-of-receipts approach is no longer compliant on its own.
2. Four quarterly summary updates per tax year, plus your year-end final declaration. The quarterly updates are lightweight: total income, total expenses, by category. The reconciliation, the allowable-vs-not-allowable judgements, and the actual tax calculation all happen at the year-end declaration in January, the same as today.
3. HMRC-compatible filing software for the quarterly submissions. The old self-assessment portal won't accept MTD ITSA submissions. You need either a cloud accounting tool that handles the submission natively, or a spreadsheet paired with bridging software (typically £30–£50 per year).

Three changes. The rest is operational discipline.

Worth saying plainly: MTD doesn't change what tax you owe. It changes when HMRC sees what you owe. Same money, different rhythm.

Most childminders don't need to overhaul how they keep records. If you already invoice parents (or run weekly cash-or-bank-transfer payments through a dedicated account), keep food shop receipts, and log mileage when you collect from school, you're 80 per cent of the way there. The remaining 20 per cent is making sure that record is in a structured digital format your filing tool can read.

The childminders who'll find this hardest are the ones currently running on a paper diary and a January reconciliation. If your "system" is a notebook of attendance plus a folder of receipts handed to your accountant in January, MTD effectively makes that approach non-compliant. Your accountant cannot submit a quarterly update if you've handed them nothing for the quarter.

Practical move for the next 30 days: get every business transaction running through a separate business bank account. Set a 15-minute weekly admin slot (Sunday evening works for most childminders, after the last child has gone home and the dishes are done) to log fees, food costs, household-share expenses, and mileage against the right categories. That single habit takes you most of the way.

A quarterly update is not a tax return. It's a summary submission. For a childminder, the categories you'll typically report are:

Total income for the quarter: weekly fees per child, settling-in fees, late-collection charges, holiday-club fees if you offer them, sibling rates, retainer or holding fees, and any add-ons like school pick-up surcharges.

Total expenses by category: food and drink for minded children, household running costs (the HMRC simplified flat-rate childminder expenses are an option here, or actual-cost apportionment), utilities apportionment, vehicle running costs and mileage, toys, books, equipment, training and CPD (paediatric first aid renewals, EYFS courses, safeguarding refreshers), professional memberships (PACEY, NCMA), insurance (public liability, employer's liability if you have an assistant), DBS renewal fees, registration fees, accountant or bookkeeper, phone, and use-of-home if you do paperwork after the children leave.

You don't reconcile each line at the quarterly stage. You report category totals. The reconciliation, the allowable-vs-not-allowable judgements, and the tax calculation all happen at the final year-end declaration.

This is why the quarterly updates feel less burdensome than people fear, once your records are in shape. If your spreadsheet aggregates by category automatically, the quarterly submission is a copy-paste of the totals into your filing tool. Ten minutes per quarter, not a weekend.

HMRC publishes simplified expenses rates for childminders that let you claim a flat rate per hour of childcare provided, instead of working out actual food, utility, and household-share costs. The flat-rate route is genuinely simpler and saves time at year-end.

Under MTD, you can still use the simplified rate. You just record the hours-of-childcare-provided figure quarterly (which you'll already have from your attendance records) and apply the flat-rate at the year-end declaration. Your quarterly submission still reports actual cash income and any non-flat-rate expenses (like training, insurance, registration fees, professional membership). The flat-rate covers food and household running costs only.

If you're switching from actual-cost expense tracking to the flat-rate (or vice versa) before April 2026, do that switch deliberately and keep both years' workings — the rules around which method gives the better outcome change with your turnover and your home setup.

There are three legitimate routes. Each has a real fit and a real cost. Pick once, commit, and stop second-guessing.

Cloud accounting software like Xero, QuickBooks or FreeAgent. Subscription cost £12–£30 per month. Includes automated bank reconciliation, invoicing, and integrated MTD submission. Best fit: childminders running with an assistant, or those at the higher end of the income band who want full visibility.

Spreadsheet plus bridging software. The spreadsheet is your record of income and expenses; bridging software (typically £30–£50 per year) reads the spreadsheet and submits to HMRC in the format MTD requires. Best fit: solo childminders with simple finances who'd rather make a one-time purchase than commit to a monthly subscription.

Hand it to your accountant. They handle the quarterly submissions on your behalf. Costs more than DIY, but if your accountant already does your year-end, the marginal cost is manageable. The catch: they can only file what you give them. Quarterly cadence still requires you to maintain the records weekly.

There's no "best" answer. The right choice depends on your transaction volume, your tech comfort, and what you already pay for.

If you're still trading on a paper diary and a January reconciliation, treat 6 April 2026 as a hard deadline and work backwards.

1. Open a separate business bank account if you don't already have one. Move all parent payments, food shopping, and supplier spend through it. Every other MTD step gets easier when business spend stops mixing with personal.
2. Pick one tool (spreadsheet plus bridging, cloud accounting, or your accountant) and commit. Set it up properly with the right categories for childminding work, including the flat-rate option if that's your route.
3. Start a 15-minute weekly admin slot. Sunday evening, last child gone, kettle on. Log the week's fees, food costs, household-share apportionments, and mileage.
4. If you're VAT-registered (rare for childminders running below £90,000 turnover), layer ITSA MTD onto your existing quarterly rhythm. Same month-end discipline, second submission.
5. If you're not VAT-registered (most childminders aren't), build the rhythm now. The first April 2026 quarterly window will arrive faster than you expect.

If you do nothing else this month: the bank account split. Everything cascades from that one decision.

For the parent-facing communication side (a different problem from MTD but the same operational discipline), see writing parent-facing copy as a childminder. Same weekly habit applied to a different surface.

LaunchKit makes a niche-specific MTD Compliance Kit for childminders. It's an Excel workbook with the income categories, expense categories, and quarterly summary tabs already set up for childminding work, including separate columns for fees per child, food costs, household-share apportionment, mileage, training, professional membership, and insurance. £16.99 on Etsy and on yourlaunchkit.co.uk. One-time purchase. Works in Excel or Google Sheets, and pairs with any HMRC-recognised bridging tool when it's time to submit.

If a structured spreadsheet plus bridging is the right fit for your business, the kit takes ten minutes to set up. If you want full cloud accounting instead, that's a different decision and we'd say so plainly. Either way, the worst route is no route.

The kit pairs with the childminder business documents bundle (£19.99) if you also want parent contracts, settling-in agreements, accident records, medication consent, and GDPR templates with the right MTD-friendly categories built in.

This article is general guidance, not tax advice or guaranteed Ofsted readiness. For your specific tax position, consult a qualified accountant. For your registration and safeguarding obligations, consult your local Ofsted inspector or early-years team.