New Tax Year Checklist for the Self-Employed: 2026/27

Every April, the tax year resets. Allowances refresh, thresholds restart, and deadlines shift. If you're self-employed, this is the moment to get your house in order, because trying to piece it all together in January is how mistakes happen.

Here's what matters for 2026/27.

Key dates for your diary

• 6 April 2026: new tax year starts (yesterday)
• 5 July 2026: first MTD quarterly update due (if you earn over £50,000)
• 31 July 2026: second payment on account for 2025/26
• 5 October 2026: deadline to register for Self Assessment if you're newly self-employed
• 5 October 2026: second MTD quarterly update due
• 31 October 2026: paper tax return deadline for 2025/26 (if you still file on paper)
• 5 January 2027: third MTD quarterly update due
• 31 January 2027: online Self Assessment deadline for 2025/26 + first payment on account for 2026/27
• 5 April 2027: fourth MTD quarterly update due + tax year ends

If you earn over £50,000, the MTD quarterly dates are new this year. Put them in your calendar now.

Making Tax Digital is live

From 6 April 2026, Making Tax Digital for Income Tax is mandatory if your self-employment or property income exceeds £50,000 (HMRC guidance). This means:

• You must keep digital records of income and expenses
• You must submit quarterly updates to HMRC using compatible software
• Spreadsheets are only acceptable if they have a digital link to your submission software

If you earn between £30,000 and £50,000, your turn comes in April 2027. But setting up digital records now means you'll have a full year of clean data when it kicks in.

Tax-free allowances for 2026/27

Check what you can earn before tax kicks in:

• Personal Allowance: £12,570 (unchanged since 2021, frozen until at least 2028)
• Trading Allowance: £1,000 of self-employment income is tax-free (if your expenses are low, this may be simpler than claiming actual expenses)
• Dividend Allowance: £500 (relevant if you operate through a limited company)
• Capital Gains Tax Allowance: £3,000 (if you sell business assets)

The Personal Allowance has been frozen for years while wages have risen. More people are being pulled into higher tax bands, which makes claiming every legitimate expense even more important.

National Insurance for 2026/27

As a self-employed person, you pay two types of National Insurance:

• Class 2 NICs: £3.45 per week (approximately £179 per year). You pay this if your profits are above the Small Profits Threshold (£6,725). If your profits are below that, you can choose to pay voluntarily to protect your State Pension entitlement.
• Class 4 NICs: 6% on profits between £12,570 and £50,270, plus 2% on anything above £50,270. This is calculated as part of your Self Assessment and paid at the same time as your income tax.

Class 2 is collected through Self Assessment now, not by separate direct debit like it used to be. It's a small amount but it counts towards your qualifying years for the State Pension. If you're near the threshold, it's usually worth paying voluntarily. Check your National Insurance record on GOV.UK to see where you stand.

Class 4 is the one that actually costs money. On £40,000 profit, for example, you'd pay 6% on the £27,430 between £12,570 and £40,000, which is £1,646. It's not optional and there's no way to reduce it other than reducing your taxable profit through legitimate expenses. Which brings us back to mileage.

Mileage: your 10,000-mile threshold just reset

If you drive for work, HMRC's approved mileage rates for 2026/27 are:

• Cars and vans: 45p per mile for the first 10,000 business miles, then 25p after that
• Motorcycles: 24p per mile
• Bicycles: 20p per mile

The 10,000-mile counter resets every 6 April. If you hit the threshold last year and were on 25p for the last few months, you're back to 45p now. That's a significant increase in the value of every mile you track early in the year.

A few things worth getting right from day one:

• Track every business journey individually. Not weekly estimates. If HMRC opens a compliance check, they'll ask for the date, where you went, why, and the distance for each trip you've claimed.
• Classify as you go. Deciding whether a journey was business or personal is much easier the same day than three months later.
• Know the commute rule. Driving from home to your regular workplace is a commute, not business mileage, even if you're self-employed. Driving from home to a client site is business. More on this here.
• Back up last year's data. You'll need your 2025/26 records for your January 2027 tax return, and HMRC can enquire for up to four years after that.

Other allowable business expenses

Mileage is often the biggest expense for self-employed people who drive for work. But it's not the only thing you can claim. Here are the main categories worth reviewing at the start of the tax year:

• Use of home as office: if you work from home regularly, you can claim a proportion of your household costs (heating, electricity, broadband, council tax, rent or mortgage interest). HMRC offers a simplified expenses flat rate of £10/month if you work 25-50 hours from home, £18/month for 51-100 hours, or £26/month for 101+ hours. Alternatively, you can calculate the actual proportion, typically based on the number of rooms used and hours worked. The flat rate is simpler but usually lower.
• Phone and broadband: if you use your personal phone for business calls, you can claim the business proportion. Same for broadband. If you have a separate business phone line, claim the full cost. Keep itemised bills or work out a reasonable percentage.
• Tools and equipment: anything you buy specifically for work. Power tools, laptops, specialist software, safety equipment. Items under £1,000 can usually be claimed in full in the year you buy them. Larger items may need to be claimed as capital allowances over several years.
• Professional subscriptions and memberships: trade body memberships, professional indemnity insurance, regulatory fees, trade publications. If it's required for your work or directly related to it, it's allowable.
• Insurance: public liability insurance, professional indemnity, business vehicle insurance (if not using the mileage allowance for vehicle costs), contents insurance for business equipment. Not your personal car insurance if you're claiming mileage at HMRC's approved rates, as those rates already include an element for insurance and running costs.
• Clothing: only if it's a uniform, protective clothing, or costume. A suit you wear to client meetings doesn't count, even if you'd never wear it otherwise. HMRC's rule is strict: it must be something you couldn't reasonably wear as everyday clothing.

The general principle: if you spent money wholly and exclusively for business purposes, you can probably claim it. If it's mixed use (like a phone you also use personally), claim the business proportion. When in doubt, keep the receipt and ask your accountant. An expense you don't claim is money you're giving away.

Record keeping requirements

Whether or not you're in MTD, HMRC expects you to keep records of:

• All sales and income
• All business expenses (including mileage)
• VAT records (if VAT registered)
• PAYE records (if you have employees)
• Grant or support payments received

Records must be kept for at least five years after the 31 January submission deadline. For the 2026/27 tax year, that means keeping records until at least January 2033.

Digital records are now the expectation, not the exception. If you're still running off paper receipts and a notebook, this is the year to switch.

Pension contributions

If you're self-employed, nobody is paying into a pension for you. The annual allowance for tax-relieved pension contributions is £60,000 (or your total earnings, whichever is lower). Contributions reduce your taxable income pound for pound.

If you earned well last year and haven't used your full allowance, you can carry forward unused allowance from the previous three tax years. Worth talking to your accountant about.

Payments on account

If your Self Assessment bill for 2025/26 was over £1,000, HMRC will ask you to make payments on account for 2026/27. These are advance payments towards next year's tax bill:

• First payment: 31 January 2027 (at the same time as your 2025/26 balance)
• Second payment: 31 July 2027

Each payment is half of last year's bill. If your income drops significantly, you can apply to reduce them, but if you reduce too much and underpay, HMRC charges interest.

Student loan repayments

If you have an outstanding student loan, repayments are collected through Self Assessment. The thresholds for 2026/27 depend on your plan type:

• Plan 1 (pre-2012 England/Wales, or Scotland/NI): repay 9% of income above £24,990
• Plan 2 (post-2012 England/Wales): repay 9% of income above £27,295
• Plan 4 (Scotland post-2012): repay 9% of income above £31,395
• Plan 5 (from August 2023 onwards): repay 9% of income above £25,000
• Postgraduate loan: repay 6% of income above £21,000

These repayments are calculated on your total income, not just self-employment profit. If you have both employed and self-employed income, your employer handles the employed portion through PAYE and Self Assessment picks up the rest. Reducing your taxable profit through legitimate expenses (including mileage) also reduces your student loan repayments. On a Plan 2 loan, every £1,000 of claimable expenses saves you £90 in student loan repayments on top of the income tax and NI savings.

If you're not sure which plan you're on, check your student loan balance on GOV.UK or look at a recent payslip if you're also employed.

Newly self-employed? Register for Self Assessment

If you started self-employment during 2025/26 and haven't registered yet, or you're going self-employed this tax year, you need to register for Self Assessment with HMRC. The deadline is 5 October following the end of the tax year in which you started. So if you began self-employment any time between 6 April 2025 and 5 April 2026, you must register by 5 October 2026.

Registration is done online through GOV.UK. You'll need your National Insurance number and details of when you started trading. HMRC will then send you a Unique Taxpayer Reference (UTR), which you'll need for your Self Assessment return and for any MTD-compatible software.

Don't leave this until the deadline. The UTR can take a couple of weeks to arrive by post, and you'll need it to set up your accounting software and make your first MTD quarterly submission if you're above the £50,000 threshold. If you're below the threshold, you still need the UTR for your annual Self Assessment return in January.

Missing the registration deadline doesn't trigger an immediate penalty, but it puts you on the back foot. Late registration often leads to late filing, which does trigger penalties. Sort it early.

Common first-week mistakes

• Assuming last year's setup still works. Phone updates, app permissions, and cloud storage can all break silently. Check everything.
• Mixing tax years. The tax year runs 6 April to 5 April, not January to December. Make sure your records, software, and mental model all align.
• Ignoring MTD. If you're over £50,000, this isn't optional any more. The first quarterly deadline is 5 July: three months away.
• Leaving everything to January. The single most expensive habit in self-employment. Setting up systems now takes an hour. Reconstructing a year of records in January takes days and produces weaker claims.

Your first-week checklist

• ☐ Put MTD quarterly dates in your calendar (if over £50,000)
• ☐ Check your accounting software is MTD-compatible
• ☐ Back up all 2025/26 records
• ☐ Start digital mileage tracking for every business journey
• ☐ Review business expenses you can claim (mileage, phone, home office, insurance)
• ☐ Check your pension contributions and unused allowance
• ☐ Confirm payment on account amounts for January and July
• ☐ Register for Self Assessment if newly self-employed (deadline 5 October)
• ☐ Update your accountant on any changes to your circumstances

The tax year has 365 days. The difference between a clean return and a stressful January usually comes down to what you do this week.

All Premium features free until 5th April 2027 (end of 26/27 tax year). KeptMiles tracks your business mileage automatically and calculates your HMRC claim.