What’s the difference between Making Tax Digital and Self-Assessment?
Income tax Self-Assessment is a single tax return submitted once a year, while Making Tax Digital for
income tax requires you to keep digital records and submit quarterly updates using HMRC-approved
compatible software.
Sole traders in the UK can claim certain business expenses on your Self-Assessment tax return to reduce your taxable profit. This means you only pay tax on the profit remaining after your allowable expenses have been deducted.
The key rule from HM Revenue & Customs is that expenses must be “wholly and exclusively for business purposes”.
