Making Tax Digital for tilers: what changes from April 2026

TL;DR: Making Tax Digital for Income Tax Self Assessment (MTD ITSA) applies to self-employed UK tilers in three income steps: over £50,000 from 6 April 2026, over £30,000 from 6 April 2027, and over £20,000 from 6 April 2028. Three real changes land at once: digital records must be created by each relevant update deadline (HMRC recommends creating them as close to the transaction date as possible), you submit four quarterly updates from compatible software each year on top of your Self Assessment tax return using compatible software, and you need compatible software. The underlying tax calculation does not change. Same money, different rhythm. Tilers face specific wrinkles around tile and adhesive materials cost cycling, the switch between day-rate and price-per-square-metre revenue, seasonal new-build versus domestic-renovation income splits, and CIS deductions where applicable. Quarterly reporting makes all of these more visible than a once-a-year tax return ever did. This post sets out what actually changes, what stays the same, and how to stay compliant without over-engineering your record-keeping.

Current HMRC rule: Each update is calculated by compatible software from digital records and covers cumulative category totals from the start of the tax year to the end of the update period - not only the previous three months. If record keeping and filing use different software, keep a permitted digital link between them; manual re-keying or clipboard transfer is not a digital link. HMRC will not apply penalty points for late quarterly updates in 2026/27, but the updates must still be sent before you submit your Self Assessment tax return using compatible software. Check HMRC digital-record guidance, quarterly-update guidance and HMRC's current MTD journey.

2026/27 simplified mileage rate: For self-employed simplified expenses, HMRC's rate for cars and goods vehicles is 55p per business mile for the first 10,000 miles and 25p per business mile after that. The 55p rate applies retrospectively from 6 April 2026. Check GOV.UK simplified vehicle expenses before relying on the figures.

If you work as a self-employed tiler or sole-trader in the UK, the MTD ITSA headline is straightforward. Mandatory digital records and quarterly updates in three steps:

• 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.

Qualifying income is your combined self-employment and property income. If you rent out a van or a storage unit alongside your tiling work, that rental income counts toward the same total.

The three real changes:

1. Digital records from the start, not reconstructed at year-end. Your income and expense records must be created by the relevant update deadline and kept in a structured digital format; HMRC recommends creating them as close to the transaction date as possible. A spreadsheet can work if it pairs with compatible software connected through a permitted digital link. Some cloud accounting software can handle both record keeping and filing; check HMRC's current compatible-software list and the provider's supported features. Pulling tile receipts and adhesive invoices out of a work bag in January is no longer a compliant approach.
2. Four quarterly updates per tax year, plus a Self Assessment tax return using compatible software. Each update contains cumulative totals for the categories you use, from the start of the tax year to the update-period end. The tax calculation still happens at year-end. The rhythm changes, not the complexity.
3. Compatible software. The existing self-assessment portal will not accept MTD ITSA submissions. You need cloud accounting software with direct MTD submission built in, or a spreadsheet paired with compatible bridging software that supports the workbook and a permitted digital link.

Worth saying plainly: quarterly figures are provisional. They are not mini tax returns. They show HMRC your business is active and give a running picture. No additional tax calculation happens at the quarterly stage.

Most service businesses have relatively clean income and expense categories. Tiling has layers that matter specifically for quarterly reporting.

Day-rate versus price-per-square-metre revenue. Some tilers charge a day rate, particularly on new-build contracts where the programme is managed by a principal contractor. Others price domestic jobs by the square metre, which means income per job varies considerably with room size, tile format, and surface complexity. Under MTD, both approaches require the same thing: recording each payment as income in the period it is received. But the pattern of income across quarters will look different depending on which mix of work you carry in a given period. A quarter heavy on new-build day-rate work may show very steady income. A quarter heavy on domestic bathroom renovations may show larger lumps. Both are fine. Quarterly figures are not required to be even.

Tile and adhesive materials cost cycling. Tilers buying for a large new-build contract or a run of bathroom renovations often buy tiles, adhesive, grout, and fixing materials ahead of invoicing the client. Under MTD, materials costs are generally recorded as a business expense when purchased. If you buy £800 of adhesive and grout in the last week of Q1 for a job that runs through Q2, that expense lands in Q1. Your Q1 expenses may look higher than your Q1 income for that job. That is expected and correct. Quarterly figures are not required to balance per job. The full-year view is what HMRC uses for tax.

Tile breakage variance. Cutting tiles for awkward angles, wet areas, and feature work always produces off-cuts and breakage. The actual materials cost on a job includes this variance. Recording what you paid for materials (including expected wastage built into your materials order) as a business expense is the correct approach. You do not need to justify each broken tile; you need to record what you paid suppliers and carry delivery notes.

Seasonal income split: new-build versus domestic renovation. New-build tiling programmes tend to be managed by the principal contractor's programme and can run through winter without the weather-driven gaps that affect external trades. Domestic renovation work, particularly kitchen and bathroom tiling, tends to slow in the post-Christmas period and peaks in spring and autumn. activity during an update period may make the cumulative income figure reflect a quieter domestic pipeline even if new-build work is steady. This is not a compliance problem. HMRC expects cumulative update figures to grow unevenly.

CIS deductions. If you work as a subcontractor on new-build or larger refurbishment projects where the principal contractor operates under the Construction Industry Scheme and deducts 20% at source, your income record for MTD purposes is your gross invoiced amount, not the net after the CIS deduction. The CIS deduction you have suffered during the year is offset against your year-end tax bill. CIS is its own scheme with its own rules. This post does not go deep on it. The point for MTD purposes is: record gross income, not net receipts.

A quarterly update reports income and expenses by category. The categories you will typically track on the expense side for a sole-trader tiler:

• Materials: tiles, adhesive, grout, tile spacers, backer boards, screws and fixings, silicone sealant, primers, membrane for wet areas, edge profiles.
• Tools and equipment: tile cutters, wet saws, notched trowels, grout floats, levels, suction cups, mixing paddles. Items replaced regularly and below the capital threshold.
• Plant hire: larger tile saws hired per job, dust extraction equipment if hired.
• Vehicle costs: van insurance, fuel, servicing, road tax. If you use HMRC's self-employed simplified-expenses mileage rate (55p per mile for the first 10,000 miles, 25p thereafter), record mileage rather than actual vehicle costs.
• Protective equipment (PPE): knee pads, safety glasses, dust masks, steel-toe boots, gloves.
• Insurance: public liability, employers' liability if labour is engaged, tools and equipment cover.
• Subcontractor costs: if you bring in a second tiler or a labourer, their invoices are a business expense. CIS deduction rules apply if they are CIS subcontractors.
• Professional fees: accountancy, trade body memberships.
• Phone and communications: the business proportion of your mobile.
• Training and certifications: any trade-specific certifications, CSCS card renewal, first aid.
• Software: accounting software subscriptions, invoicing tools.
• Bank charges: business account fees, card processing costs.

Your software sends cumulative totals for each category at every update, not individual receipts. The paperwork stays in your records.

Your software uses either standard update periods or calendar update periods. Each update is cumulative, not a separate three-month return. Under standard periods the coverage runs 6 April-5 July, 6 April-5 October, 6 April-5 January and 6 April-5 April; under calendar periods it runs 1 April-30 June, 1 April-30 September, 1 April-31 December and 1 April-31 March. The corresponding deadlines are 7 August, 7 November, 7 February and 7 May. The tax return is due by 31 January after the tax year.

The time required varies with transaction volume, record quality and the software you use; the continuing duty is to keep accurate digital records and check the software-generated update. The ongoing work is in keeping your income and expense records current throughout each quarter, not in the filing act itself.

Cloud accounting software. Platforms such as Xero, QuickBooks, or FreeAgent at £12–£30 per month. They handle income recording, expense categorisation, mileage tracking, and cumulative MTD updates natively. Best fit: tilers with higher turnover, VAT registration, or regular subcontractors on the books who want one system handling most of the financial administration.

Spreadsheet plus bridging software. You maintain your own spreadsheet recording income and expenses by category; compatible bridging software receives the records through a permitted digital link and submits the cumulative update to HMRC. Best fit: tilers with simpler finances, sole-trader operations with clear expense categories, and those already comfortable maintaining their own records.

Hand it to your accountant. Your accountant manages the quarterly updates from the records you supply. The incremental cost for quarterly updates may be reasonable if they already handle your year-end return. The catch: your accountant can only submit what you have recorded. You still need to maintain digital records between meetings. Handing everything over in January will not work on a quarterly schedule.

There is no single right answer. The right approach depends on your transaction volume, your VAT position, and how much of this you want to own yourself.

If your records are currently informal (cash jobs noted loosely, adhesive and tile receipts gathered approximately, a spreadsheet started and not kept up), the April 2026 deadline is the hard reset.

1. Separate business and personal money completely. A dedicated business bank account and card make every quarterly step faster and remove the most common source of errors.
2. Choose your approach now. Cloud accounting, spreadsheet plus bridging, or accountant-managed. Set it up before the first quarterly period begins.
3. Establish your expense categories consistently. Consistent categorisation from day one of Q1 is easier than restating categories mid-year.
4. Record all income as it arrives. Every payment, whether invoice settled by bank transfer or cash on completion, is income in the period received.

If you do nothing else before April: open a dedicated business account and start recording every payment the same week it arrives. Everything else cascades from that.

Quarterly updates are still required. HMRC says it will not apply penalty points for late quarterly updates in 2026/27; for later tax years, missed update deadlines can generate penalty points and a financial penalty once the threshold is reached.

For the document side of running a tiling business, including client contracts, site risk assessments, scope of works, materials waste logs, and sign-off documents, see essential business documents for UK tilers.

Check current GOV.UK guidance and HMRC compatible-software information for your own MTD obligations.

The kit pairs with the tiler business documents bundle (£19.99) if you also want client contracts, site risk assessments, materials waste logs, scope of works templates, and the operational paperwork that sits alongside tidy quarterly accounts.

This article is general guidance, not tax advice. For your specific tax position, CIS status, and income-recognition approach, consult a qualified accountant or tax adviser with construction sector experience.