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If you run your own chair, booth or barbershop in the UK, Making Tax Digital for Income Tax changes how you report your earnings to HMRC. The regime is live and brings self-employed barbers into scope in stages based on income.
Once you are in, you keep digital records, send HMRC a quarterly update four times a year and file a final declaration in place of the old Self Assessment return.
This guide covers what MTD means for a barbering business specifically: whether you are caught, when your start date falls, the software that suits a chair or mobile setup, and how to keep on top of it without it eating into your time behind the chair.
What is Making Tax Digital for Barbers?
Making Tax Digital for Income Tax is the HMRC system that moves self-employed people and landlords onto digital record-keeping and in-year reporting.
For a barber working as a sole trader, it means your takings and costs are recorded digitally as you go, rather than totted up once a year.
The mechanics of the regime as a whole, including how it works across every trade it covers, are set out in our guide to Making Tax Digital for Income Tax.
Does MTD Apply to Your Barbering Business?
Not every barber is brought in at the same time. It depends on your qualifying income, which is the total gross income from your self-employment and any property, counted before expenses.
HMRC works out your start date from your gross qualifying income two tax years before the year you join. By the time your obligation begins, HMRC already holds a confirmed figure from a completed Self Assessment return.
For example, if your barbershop turned over £55,000 in gross income in the 2024/25 tax year, you are brought into MTD from 6 April 2026, because that figure sits above the threshold for the relevant year.
What Counts as Qualifying Income Under MTD for Barbers?
Qualifying income is the combined gross turnover from your self-employment and property before any expenses or deductions. It is not your profit HMRC looks at the total income coming in, not what remains after costs.
Qualifying Income includes:
Gross income from self-employment (your barbering business turnover before any expenses)
Gross income from UK property
Gross income from overseas property, if you are a UK tax resident and the property is subject to UK Income Tax
All sources are combined into a single total. It is your gross turnover that counts, not your profit after expenses.
Qualifying Income does not include:
PAYE employment income (if you also work as an employee)
Dividend income
Pension income
Savings interest
Capital gains
Working Out Your Qualifying Income For Barbers
Your qualifying income is calculated before you deduct expenses like:
Rent for your chair or shop space
Equipment and supplies (scissors, clippers, razors)
Product costs
Utilities and insurance
Marketing and advertising
For Example: Even if you made £60,000 in sales but had £40,000 in expenses (leaving £20,000 profit), your qualifying income is still £60,000 for MTD purposes.
Check your eligibility in seconds; use the RentalBux MTD Calculator to calculate your qualifying income and see if you’re within the MTD threshold.
Who is Exempt from MTD for Barbers?
Some barbers may be exempt from MTD for barbers, either permanently or temporarily.
You're automatically exempt if you:
• Don't have a National Insurance number • Have qualifying income of £20,000 or less • Submit tax returns as a personal representative or trustee
You can apply for an exemption if you're digitally excluded, meaning:
• You cannot reasonably access or use digital software • You have no internet access • You have a disability that prevents digital record-keeping • You're in a remote area with no connectivity
Certain circumstances may give you temporary exemption until April 2027, including:
• Being a non-UK resident • Claiming averaging relief • Receiving income from trusts or estates • Being eligible for split-year treatment
What Barbers Need to Do for Making Tax Digital for ITSA?
Get HMRC-recognised MTD Software
You’ll need to use HMRC-recognised software to comply with Making Tax Digital for barbers.
This software allows you to create and store digital records of your income and expenses, send quarterly updates to HMRC, and submit your annual tax return through a single, compliant system.
MTD Software Options for Barbers:
Full-feature accounting software that creates digital records and submits to HMRC
Bridging software that connects your existing spreadsheets to HMRC
Barbershop-specific features to look for:
Bank feed integration (automatic transaction import)
Receipt scanning via mobile app
Expense categorisation
Mileage tracking (for mobile barbers)
Multiple income source support (if you rent chairs)
Create Digital Records Under MTD for Barbers
You must keep digital records of:
Record Requirements for Making Tax Digital for Barbers:
Under Making Tax Digital for Barbers, it's essential to keep accurate records for each transaction. This includes noting the amount of each transaction, the date the transaction occurred, and the category of the transaction, such as whether it's income or an expense. Properly categorizing these details helps ensure your records are in compliance with MTD requirements.
Note
Simplified Record-Keeping Option: If your annual turnover is below £90,000, you can use simplified categorisation, recording transactions simply as income or expense without detailed categories.
