Are you in? It’s your takings, not your profit
Add up everything you were paid for self-employed care work in the 2025/26 tax year – private clients, families, payments from clients’ direct payments or personal budgets if you are self-employed for them, and bookings through care platforms before their fee – before taking off mileage or anything else. Wages from a care agency or care home through payroll don’t count. If the self-employed total (plus any rent from property you let) is over £30,000, MTD applies from 6 April 2027. Over £50,000 and you have been in since April 2026.
Over £50,000
Over £30,000
Over £20,000
planned
Your work in accountant language
What actually happens in your working life, what your accountant and HMRC call it, and what to do about it.
| What happens | Accountant calls it | What you do |
|---|---|---|
| A client’s family pays you for the week’s visits | Sales / turnover | Record the payment when you receive it. |
| A care platform pays you after taking its fee | Gross income + an expense (fees) | Record the full amount the client paid as income and the platform fee as an expense. |
| You drive from one client’s home to the next | Business mileage – allowable | Log every trip. 45p a mile for the first 10,000 business miles, 25p after. |
| You buy gloves, aprons and hand gel | Allowable expense – PPE and supplies | Keep the receipt. |
| You pay for a moving and handling or medication course | Allowable expense – training | Keep the certificate and receipt. |
| You pick up shopping for a client and they pay you back | Not income – a reimbursement | Keep the receipt with a note. It’s not your income or your expense. |
| You move money to your personal account | Drawings – not an expense | Fine to do, but it doesn’t reduce your tax. |
| Every three months | Quarterly update | Your software sends HMRC your income and expense totals. |
| After 5 April | Final declaration | Confirm the year’s figures; tax is worked out and due by 31 January. |
What can a carer claim?
✓ Usually allowable
- Business mileage between clients (45p a mile for the first 10,000 miles), or bus and train fares
- Parking while you are with a client
- Gloves, aprons, masks, hand gel and other PPE
- Tunics or uniforms
- Care platform fees and payment processing fees
- DBS checks and update service subscription
- Training – manual handling, first aid, medication, dementia care
- Public liability and professional indemnity insurance
- Business share of your phone and accounting software
✗ Not allowable
- Travel from home to a single regular workplace if you only have one client there long term
- Everyday clothes
- Shopping you buy for clients and are paid back for (it isn’t your expense)
- Your own meals during shifts
- Money you take out for yourself (drawings)
Rules that matter for self-employed carers
Self-employed or employed?
This is the big question for carers. If a person using direct payments or a family directs your hours and duties and you work only for them, you may legally be their employee, paid through payroll – and that pay is not part of MTD. If you have several clients, set your own rates and run your own diary, you are more likely self-employed. HMRC’s Check employment status for tax tool can help.
Agency work plus private clients
Many carers do both. Agency wages through PAYE are employment income and are left out of the MTD calculation. Only your self-employed care income (plus any rental income) counts towards the threshold.
Mileage is usually your biggest claim
Driving between clients is business travel. A simple mileage log – date, from, to, miles – is all you need, and it can make a big difference to your profit.
Worked example
Grace is a self-employed carer with private clients in Norwich (illustrative example)
| Takings (turnover) | £31,800 |
| less Business mileage (9,400 miles at 45p) | −£4,230 |
| less Care platform fees | −£1,900 |
| less PPE and supplies | −£420 |
| less Training and DBS update service | −£310 |
| less Insurance | −£260 |
| less Phone (business share), uniforms and parking | −£540 |
| Profit | £24,140 |
| Income tax (estimate) | £2,314 |
| Class 4 National Insurance (estimate) | £694 |
| Total tax for the year | £3,008 |
| Put aside each month | £251 |
Estimate for 2026/27 using England, Wales & NI rates, assuming no other income. Scotland has different income tax bands.
What a quarterly update looks like
A typical quarter for a self-employed carer: check payments from each client or platform against your rota, add up your mileage log, photograph receipts for PPE and training, keep client shopping receipts separate – then press submit in your software, or let your accountant do it. Logging your miles at the end of each day is the habit that pays off most.
| Quarter | Period | Submit by |
|---|---|---|
| Q1 | 6 Apr – 5 Jul | 7 Aug |
| Q2 | 6 Jul – 5 Oct | 7 Nov |
| Q3 | 6 Oct – 5 Jan | 7 Feb |
| Q4 | 6 Jan – 5 Apr | 7 May |
| Final declaration | The whole tax year | 31 Jan following |
Quarterly updates are summaries – they don’t change when you pay. Tax is still due by 31 January (plus payments on account on 31 January and 31 July if they apply to you).
What will an accountant cost?
Typical monthly fees under MTD for Income Tax for: Sole trader, one business.
| Option | What you get | Per month |
|---|---|---|
| You do it yourself | MTD-compatible software. You keep the records and send the updates. | £0–£15up to £180 a year |
| Accountant files for you | You keep records in an app; they check them, send the 4 quarterly updates and the final declaration. | £30–£60about £360–£720 a year |
| Full service | They do the bookkeeping too – you share receipts and bank feeds, they handle the rest. | £60–£120about £720–£1,440 a year |
What pushes the price up: lots of transactions every month, or more than one income stream; records kept on paper rather than in an app; being VAT-registered; catching up on missed updates or late returns.
What a fixed-fee quote should include
- All 4 quarterly updates and the final declaration (your tax return)
- The MTD software licence – or whether you pay for it separately
- Whether they do the bookkeeping or only check what you’ve recorded
- A reminder before each deadline and an estimate of the tax to put aside
- Whether VAT (20%) is added on top – not every practice charges it
Accountancy fees for your business are an allowable expense, so they reduce your tax bill.
Indicative ranges from published UK price lists, checked October 2026. Not a quote – your fee depends on how many transactions you have, how tidy your records are and where you live.
Questions self-employed carers ask
I work for a care agency and have a couple of private clients. Does MTD apply?
Your agency wages don’t count. Your private client income does – over £1,000 a year and you need to register for Self Assessment, and above the MTD threshold (with any rental income), MTD applies.
I’m a PA paid from my client’s direct payments. Am I self-employed?
It depends on how you work. Many PAs are legally employees of the person they support and are paid through payroll. If you have several clients and run your own business, you may be self-employed. HMRC’s status tool can help you check.
Can I claim mileage between clients?
Yes. Travel between clients is business travel – 45p a mile for the first 10,000 business miles in the tax year, 25p after.
A client pays me back for their shopping. Is that income?
No. Money that simply reimburses you for a client’s own shopping is not your income, and the shopping is not your expense. Keep the receipts.
Sources
- Find out if and when you need to use Making Tax Digital for Income Tax – GOV.UK
- Work out your qualifying income for Making Tax Digital for Income Tax – GOV.UK
- Send quarterly updates using Making Tax Digital for Income Tax – GOV.UK
- Find software that works with Making Tax Digital for Income Tax – GOV.UK
- Penalties for Making Tax Digital for Income Tax – GOV.UK
This guide is general information about HMRC’s Making Tax Digital rules as of 26 October 2026, not tax advice. MTD Match is an independent introduction service and is not affiliated with HMRC. Check gov.uk or speak to an accountant about your own situation.