Making Tax Digital for childminders: what changes in April 2026

Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is the biggest change to how self-employed people report income to HMRC in a generation. From April 2026, self-employed childminders earning over £50,000 a year from self-employment and property must keep digital records and send quarterly updates to HMRC using compatible software. The £30,000 threshold follows in April 2027, and £20,000 in April 2028.

Who is in scope

MTD for ITSA applies to qualifying income, which is your gross self-employment and property income before expenses — not your profit. So if your fees brought in £52,000 but your business expenses were £18,000, your qualifying income is £52,000, and you're in scope from April 2026.

• April 2026: qualifying income over £50,000
• April 2027: qualifying income over £30,000
• April 2028: qualifying income over £20,000

What you have to do under MTD

1. Keep digital records of every transaction (income and expenses), categorised correctly. Paper receipts are fine as a source — but the data must be entered into MTD-compatible software.
2. Send quarterly updates to HMRC summarising your income and expenses for that quarter. These don't have to be perfectly accurate — they're estimates.
3. Submit a final declaration at the end of the tax year confirming your figures and any other income (like savings interest or PAYE earnings). This replaces the annual Self Assessment return.

The quarterly deadlines

The standard quarters and submission deadlines are:

• 6 April – 5 July → submit by 7 August
• 6 July – 5 October → submit by 7 November
• 6 October – 5 January → submit by 7 February
• 6 January – 5 April → submit by 7 May

You can opt for calendar quarters (ending 30 June, 30 Sept, 31 Dec, 31 March) — the deadlines stay the same.

What counts as childminding income and expenses

Income

• Parent fees (whether paid by the parent or via salary-sacrifice schemes like Tax-Free Childcare)
• Local authority funded hours payments (15h, 30h, 9-month-old offer)
• Deposits and registration fees retained
• Late pickup fees
• Income from selling resources or training

Allowable expenses

• Food and drink for minded children
• Toys, books, craft and consumables
• Outings, soft-play, swimming, classes
• Wear and tear on furniture and equipment
• A portion of household bills (heat, light, water, council tax) — most childminders use the simplified expenses or sector-standard percentages
• Car costs for school runs and outings (mileage at HMRC rates is usually simpler)
• Public liability insurance, Ofsted fee, DBS renewals, first aid courses
• Professional association membership, plus any CPD
• Accountancy and software (yes, ChildmindPro is allowable)

How to get ready

1. Open a separate bank account for your childminding income. Don't mix personal and business — it makes everything harder.
2. Pick MTD-compatible software now and start logging this tax year, even if you're not yet in scope. The habit is the hard part, not the software.
3. Photograph receipts as you go. A drawer of crumpled receipts in March is the single biggest cause of January tears.
4. Set aside tax monthly. A rough rule: 25–30% of profit into a separate savings account each month.
5. Sign up for MTD with HMRC once you confirm you're in scope. Your software will then connect to your HMRC account.

Common mistakes

• Counting funded hours as not-income. They are income — and they're taxable. Just because the money came from the council doesn't mean it doesn't go on your return.
• Mixing parents' card payments with personal spending. If a parent pays you on a personal account by mistake, transfer it to your business account immediately and note it.
• Forgetting use-of-home expenses. Most childminders are entitled to a meaningful chunk — don't leave it out.
• Trying to switch software mid-year. Pick once, commit, and migrate at the start of a tax year.

What to do next

If you're already at or near the threshold, your best move this month is to start digital record-keeping. Even if MTD doesn't apply to you until 2027 or 2028, you'll thank yourself the first time HMRC asks for a 6-week breakdown of expenses.