Overview
- The rules, which took effect Monday, require affected sole traders and landlords to keep digital records, file four quarterly updates using HMRC‑compatible software, and make a final year‑end declaration.
- About 780,000 to 864,000 people are in scope in the first phase, covering those with combined self‑employment and property turnover above £50,000.
- HMRC clarified that PAYE wages do not count toward the threshold, so only income from self‑employment, Construction Industry Scheme work, and property is used to decide if someone must join.
- A new points‑based penalty system replaces the old single £100 fine, with a £200 charge after four missed deadlines, and no penalties for late quarterly updates during the 2026/27 transition year.
- The programme widens next April to people with income over £30,000, with plans to reach over £20,000 from April 2028 subject to legislation, while accountants and commentators warn of extra admin costs and greater digital oversight.