If you've heard the phrase "Making Tax Digital" (MTD) and wondered if it applies to you, the short answer is: Yes.
HMRC is officially phasing out paper records and the old system of manually typing your numbers into their website once a year. They want your tax records kept digitally and sent directly to them using approved software.
Nule MTD Simulator
Check exactly when the rules apply to your business.
What are the rules right now?
HMRC is rolling this out in stages depending on how your business is set up:
- •If you are VAT-Registered: You should already be doing this. All VAT-registered businesses must keep digital records and use MTD-compatible software.
- •If you earn over £50,000: This starts right now (April 2026). You fall under "MTD for Income Tax." Instead of one massive tax return, you must submit quarterly updates using software.
- •If you earn over £30,000: Your turn is coming up. MTD for Income Tax applies to you starting in April 2027.
It's turnover, not profit.
The threshold is based on your gross income before expenses. A plumber invoicing £55k but taking home £32k after materials and van costs is still above the £50k line. Most full-time tradies will be caught by the first or second wave.
How does it work: The MTD Timeline
Under the old system, you scrambled once a year in January to find all your receipts and submit one massive tax return. With MTD, your reporting is broken down into smaller, digital chunks.
One Annual Panic
Spend January stressed out, digging through the van for faded Screwfix receipts to file one giant Self Assessment before the deadline.
Digital & Done
Send quick digital updates throughout the year straight from Nule. No receipts to find, no January stress, and no tax bill surprises.
Every 3 Months: Quarterly Updates
Instead of a tax return, you just send HMRC a quick digital summary of your income and expenses. Because you use Nule, this happens almost automatically with a single tap.
End of your Accounting Year
You submit an "End of Period Statement". This is the final wrap-up where Nule helps apply any accounting adjustments or tax reliefs you are entitled to.
January 31st: Final Declaration & Payment
You submit your Final Declaration to tie everything together and pay your tax bill. Because Nule calculated your "Tax Set Aside" all year, you already have the exact cash ready.
The quarterly deadlines
Each quarter you send HMRC a summary of your income and expenses, broken down by category (materials, travel, tools, etc.). Here are the deadlines for a standard April–April tax year:
| Quarter | Period | Deadline |
|---|---|---|
| Q1 | 6 Apr – 5 Jul | 7 August |
| Q2 | 6 Jul – 5 Oct | 7 November |
| Q3 | 6 Oct – 5 Jan | 7 February |
| Q4 | 6 Jan – 5 Apr | 7 May |
| Final Declaration | 31 January | |
What exactly do I have to do?
You only need to do two things to stay on the right side of the taxman:
- 1.Keep digital records: No more notepads on the dashboard. When you do a job or buy materials, it must be logged digitally.
- 2.Use approved software: Tax data must be sent directly from an app to HMRC via an unbroken "digital link." You cannot keep a spreadsheet and manually type totals into the HMRC website.
What counts as a "digital record"?
For every bit of money coming in or going out, HMRC wants:
- •Income: Date, amount, customer name, description of work
- •Expenses: Date, amount, supplier, category (materials, travel, tools, etc.)
You don't need to photograph every receipt—but the record of each transaction must live in software, not on a notepad or in your head. Records must be kept for 5 years.
What happens if you don't comply?
HMRC has introduced a points-based penalty system. It's designed to catch repeat offenders rather than punish one-off mistakes, but it adds up fast:
Late submissions
Each missed quarterly deadline = 1 penalty point. At 4 points you get a £200 fine, and every late submission after that is another £200. Points expire after 24 months of clean submissions.
Late payments
No penalty for up to 15 days. After that: 2% of tax owed at day 15, another 2% at day 30, then 4% per year on whatever's still outstanding. Plus interest at Bank of England base rate + 2.5%.
No digital records
If HMRC checks and finds you're not keeping compliant digital records: up to £100 per failure, with higher penalties for repeated non-compliance.
The easiest way to avoid all of this is to use software that handles it for you from day one.
How Nule solves this for you
You're a tradie, not an accountant. Nule is built specifically for tradespeople—it handles MTD compliance as a side effect of you just running your business normally.
Just tell it what happened
"Spent £45 at Screwfix on copper fittings." Nule's AI understands natural language. It logs the expense, categorises it (materials), and tags the supplier—no forms to fill in.
Jobs, quotes & invoices
Every job you create, every quote you send, every invoice that gets paid—it's all recorded digitally with the date, amount, customer, and description that HMRC requires.
Auto-categorised expenses
Nule automatically sorts your spending into HMRC's categories—materials, travel, tools, premises. No guessing which box a Toolstation receipt goes in.
Tax Set Aside
Nule calculates your estimated tax liability in real time as you work. The "Tax Set Aside" figure tells you exactly how much to keep back, so there are no surprises in January.
Direct HMRC submission
Nule connects to HMRC's MTD API. When your quarterly deadline approaches, review the numbers and hit submit—done in seconds, fully compliant, no accountant needed.
Unbroken digital link
From the moment you log a job to the moment HMRC receives your figures, there's no manual retyping. That's the "digital link" HMRC demands—Nule provides it end to end.
What MTD actually looks like with Nule
Here's a normal Tuesday for Dave, a plumber in Leeds. He doesn't think about MTD once.
Picks up 15mm fittings and a roll of solder from Screwfix on the way to a job.
Tells Nule: "Spent £38 at Screwfix on copper fittings." → Logged as materials, tagged to the job.
Arrives at Mrs Johnson's to fit a new bathroom basin. Starts the job timer.
Nule records the time entry against the job. Hours and location tracked automatically.
Job done. Marks it complete and sends the invoice from his van.
Invoice created with customer name, date, amount, and work description — exactly what HMRC needs.
Fills up the van. £65 at Shell.
"Spent £65 on diesel" → Auto-categorised as travel. No receipt to keep.
Checks his dashboard. Tax Set Aside: £4,120. Safe to Spend: £2,847.
Every transaction from today is already in his digital records. MTD-compliant without lifting a finger.
What do I do right now?
You don't need to panic. You just need to start. Here's the plan:
Get set up with Nule
Join the waitlist now. When we launch, you'll have MTD-compatible software ready to go from day one. No migration headaches.
Run your business as normal
Log jobs, send invoices, track expenses — just by talking to Nule. Every transaction becomes a compliant digital record automatically.
Review and submit each quarter
When the deadline approaches, Nule shows your totals. Check them, tap submit, done. Your accountant can review too if you want a second pair of eyes.
Nule works with your accountant
You don't have to choose between Nule and your accountant. Give them read access so they can review your numbers before each submission. They can handle the Final Declaration and year-end adjustments if you prefer. Nule does the daily legwork — your accountant does the expertise.