Zoho Books now supports sole traders too!
With HMRC’s Making Tax Digital for Income Tax (MTD for IT) mandate coming into effect from April 2026, The UK edition of Zoho Books is gearing up to help sole traders stay compliant. The update supports HMRC’s 2026 requirement for digital recordkeeping and quarterly reporting. So if you are a sole trader with annual income over £50,000 in the 2024–25 tax year you fit that requirement and need to start recording and reporting digitally.
📢 What’s New in Zoho Books UK Edition for Sole Traders?
Soon new functionalities will be rolled out in Zoho Books UK to simplify tax compliance and business recordkeeping for sole traders. These features are part of a curated experience tailored specifically for this segment, and are accessible even on the free plan.
Available from the free plan of Zoho Books, sole traders (both VAT and non-VAT registered) can join the testing phase of HMRC’s MTD for Income Tax mandate (April 2025 to March 2026) with Zoho Books. More on the mandate and eligibility later.
✅ Key Highlights
1. Simplified User Interface
- Only essential features enabled, such as:
- Invoicing
- Expense management
- Banking view with relevant transaction types
2.Tailored Free Plan
- Sole traders (both VAT and non-VAT registered) will access a focused version of Zoho Books via the free plan.
- Designed to meet the needs of MTD for IT testing (April 2025 to March 2026).
3. Tax Reporting Tools
- SA103F report available from the last week of June 2025.
- MTD Income Tax filing functionality to follow soon.
4. New Org Creation Field
- Sole traders must select their business type when creating an organisation.
- Selection is mandatory and immutable (except for “Others”).
🧾 Background: MTD for Income Tax (ITSA)
Currently, sole traders submit income tax returns annually, typically through XML APIs, offline forms, or the HMRC portal. Under MTD for IT, this process becomes digital, structured, and more frequent:
- Maintain digital records
- Submit quarterly updates
- Provide end-of-period statements
- Submit year-end declarations
Mandatory from April 2026 for:
- Sole traders earning over £50,000 in the 2024–25 tax year
💡 Goldstar’s Take
This is a smart, timely move by Zoho — and one that positions advisors to lead, not lag, on MTD ITSA compliance.
By extending support to sole traders — even on the free plan — Zoho is making regulatory readiness accessible and testable, which matters when so many clients still rely on spreadsheets or ad-hoc tools.
The simplified UI and curated feature set reflect good product thinking: don’t overwhelm sole traders, just give them what they need to stay compliant. Combined with the new “Business Type” selector, it also makes partner-led onboarding much more structured.
That said, we’ll be watching closely for:
- How intuitive the UX really is for end users
- The depth of support around quarterly submissions and year-end declarations
- Whether SA103F and future filing tools can match the speed and reliability of more mature players in this space
Bottom line?
It’s a meaningful step in the right direction, and the early access phase is a golden opportunity for us and our clients to shape what “MTD-ready” looks like in Zoho.
✅ Who Can Start Now?
Sole traders earning under £50K in the 2024–25 tax year can begin using Zoho Books immediately — starting with SA103F reporting and digital recordkeeping.
Those over £50K? Sit tight — quarterly income tax filing capabilities will roll out shortly, in time for HMRC’s full compliance window beginning April 2026.
🔗 Pro Tip for Advisors
Got sole trader clients?
Encourage them to:
- Set up their org in Zoho Books using the new “Business Type” field (select Sole Trader)
- Explore the simplified UI and test features ahead of HMRC’s mandate
- Stay tuned — help docs and filing guidance are on the way
Early adoption = fewer surprises in 2026.
📌 What You Should Do Next…
For Accountants & Bookkeepers
If you manage sole trader clients, this update is your early window to guide them toward MTD ITSA readiness:
- Review Your Client Base
- Identify sole traders with projected £50K+ turnover in 2024–25
- Prioritise those not yet using digital accounting software
- Start Them on Zoho Books (Free Plan)
- Set up accounts with the “Sole Trader” business type
- Let them explore the streamlined UI and reporting features
- Walk Through the SA103F Report
- Run test submissions with lower-revenue clients
- Provide feedback to Zoho and prepare workflows for higher-revenue clients
- Set the Filing Roadmap
- Inform clients that quarterly filings go live soon — but SA103F is available now
- Use this interim period for cleanup and education
- Plan a Client Comms Campaign
- Share a short update, help doc, or training invite
- Emphasise: “start now, stay compliant later”
🔗 Pro Tip: Early engagement builds trust and reduces 2026 filing crunch. Consider this your dry run — while the stakes are still low.
For Sole Traders themselves
If you’re a sole trader in the UK, this is your opportunity to prepare for HMRC’s 2026 mandate — without the last-minute scramble:
- Sign Up for Zoho Books UK (Free Plan)
- When prompted, select “Sole Trader” as your business type
- This unlocks a simplified version of Zoho Books made just for you
- Start Tracking Your Business Digitally
- Use the platform to log invoices, expenses, and bank transactions
- The system will auto-generate your SA103F report
- No More End-of-Year Surprises
- From 2026, you’ll need to submit tax updates quarterly
- Zoho will soon add filing features — but you can start building good habits now
- Ask Your Accountant for Help
- Unsure how to get started or what you need to track?
- Your advisor can walk you through the essentials
🔗 Pro Tip: The 2026 deadline might feel far off, but starting now puts you in control — and saves you time, money, and stress later.
📦 Wrapping Up
Zoho Books is getting ahead of HMRC’s 2026 MTD for Income Tax mandate — and so can you.
Whether you’re advising clients or running your own business as a sole trader, this is your chance to get comfortable with digital recordkeeping, explore HMRC-aligned reports, and prepare for a smoother transition to quarterly filing — with zero cost of entry.
✅ If you’re an accountant or bookkeeper:
Start onboarding your sole trader clients now. Prioritise those earning over £50K, and help them test the new SA103F workflows inside Zoho Books.
✅ If you’re a sole trader:
Sign up for Zoho Books, select “Sole Trader” as your business type, and start logging your income and expenses. You’ll be one step ahead — and one less deadline behind.
💬 Need help getting started or explaining the changes?
We’re here to support your team or your clients through setup, education, and best practice.
👉 Get in touch with the team at Goldstar IT — we’ll help you make the most of this new functionality.