Sole traders and landlords across the UK could face a stressful summer as new research from business management platform Tide reveals that more than 200,000 qualifying business owners are not ready for the Making Tax Digital (MTD) switch, despite the first filing deadline being less than 30 days away.
Tide first highlighted the issue in February 2026, revealing that sole traders faced a £2.18 billion compliance bill, equivalent to £753 per business.
The latest research, based on a survey of 500 sole traders and landlords with annual revenues above the £50,000 qualifying threshold for year one of MTD, finds that many are still unsure what the change means for them, despite the first filing deadline on 7 August.
With the deadline approaching, 22% of owners still do not know it is coming, while 1 in 4 (25%) have not yet signed up with HMRC for Making Tax Digital. Of the estimated 864,000 businesses and landlords that qualify for MTD in 2026, this leaves around 216,000 yet to sign up and submit their first update.
85% don’t know how often they will need to file
Making Tax Digital requires business owners to submit tax information to HMRC five times a year: four quarterly updates and one final annual submission. However, Tide’s research found that 85% of those joining MTD this year do not know this, with 31% believing they will need to file eight times or more.
Owners expect to spend six days dealing with MTD
The first MTD deadline arrives during a busy summer trading period, with 44% of owners saying they will need to spend normal working hours on MTD-related admin and 32% expecting to complete it during time off.
Overall, sole traders and landlords estimate the new tax admin will require six full days of their time over the next 12 months, representing £1.5 billion in lost revenue across qualifying businesses in the first year of MTD.
To support those preparing for the switch, Tide is taking its “Making Tax Delicious” campaign across the UK, offering free ice cream and MTD guidance from Tide experts. Tide customers can also manage digital records and submit MTD returns through Tide’s HMRC-recognised tool, free in the Tide app.
George Schmidt, CEO UK/Europe at Tide, says:
“No one wants to be thinking about tax over summer, but Making Tax Digital is here and the first deadline is just days away.
“The first wave of business owners need to ensure they are signed up with HMRC and file on time to avoid penalties. We hope to raise awareness and help people make their first submission, so they can get on with enjoying their summer.”
