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Is the MTD £30,000 threshold based on gross sales or what I'm paid out?

Last reviewed 28 October 2026 against GOV.UK guidance. General information, not tax advice.

Short answer: Gross. HMRC's qualifying income is your total turnover from self-employment and property before expenses, taken from the tax return for the earlier year. HMRC's October 2026 announcement says turnover means gross income “before any tax allowances or expenses are deducted”. Marketplace fees, ads and postage labels don't reduce it, and all your platforms are added together.

Which year is tested

The £30,000 test that decides whether you join on 6 April 2027 looks at your 2025 to 2026 Self Assessment return, the one due by 31 January 2027. HMRC reviews returns and writes to people who are over the threshold. HMRC also says that if you don't get a letter, it's still your responsibility to check.

The next step down is £20,000, tested on your 2026 to 2027 return, for people starting on 6 April 2028.

What gets added together

  • Turnover from every sole trader business, so all your marketplaces and your own website
  • Gross UK and foreign property income, if you're a landlord

Employment income (PAYE wages), pensions, savings and dividends aren't qualifying income. A share of partnership profit doesn't count either. HMRC's qualifying income page covers the edge cases, including businesses that have stopped and accounting periods that aren't 12 months long.

Why online sellers get this wrong

Marketplace dashboards and bank deposits show what you were paid, after fees. On platforms where fees and ads take 10 to 20% of sales (a rough range, and it varies by platform and seller), a seller with £27,000 of deposits can have well over £30,000 of turnover. Collected sales tax or VAT that the platform passes on, and refunds, work the other way: they come out of gross receipts.

How to check your own figure

A quick way to estimate your turnover from platform files. It's not a substitute for your tax return figure.

  1. Download a full tax year of transaction files from each platform: 6 April 2025 to 5 April 2026 for the 2027 test.
  2. Add up gross sales plus postage charged to buyers, on each platform.
  3. Take off refunds, and tax collected and paid on by the platform.
  4. Add turnover from any other sole trader business, plus gross property income.
  5. Compare the total with the turnover you put on your 2025 to 2026 return, because that's the figure HMRC uses.

If your return showed net figures as turnover by mistake, talk to HMRC or an accountant about correcting it. Don't just adjust your MTD start date yourself.

Worked example: three small sources, one test

Example Illustrative 2025 to 2026 figures, not real data.

SourcePaid out / netGross turnover
Etsy shop£11,900.00£14,200.00
eBay£8,300.00£9,600.00
Rent from a flat (gross rent)n/a£7,200.00
Qualifying income£31,000.00

No single source is near £30,000, and the platform payouts add up to just £20,200. Qualifying income is still £31,000, so this person would need MTD from 6 April 2027 unless exempt.

Key dates for the April 2027 group

DateWhat happens
31 Jan 2027Deadline for your 2025 to 2026 return. It's the one HMRC uses for the £30,000 test
6 Apr 2027MTD starts if qualifying income was over £30,000. Digital records from this date (standard periods)
7 Aug 2027First quarterly update (6 Apr to 5 Jul 2027)
7 Nov 2027 · 7 Feb 2028 · 7 May 2028Updates 2, 3 and 4 (each cumulative from 6 April)
31 Jan 2029Submit the 2027 to 2028 tax return through your software and pay
6 Apr 2028Threshold falls to £20,000, based on the 2026 to 2027 return

Penalty points for late quarterly updates apply from 2027 to 2028. 4 points means a £200 penalty. GOV.UK: send quarterly updates.

Want your marketplace exports turned into one MTD-ready workbook?

TidyTill reads Etsy, eBay, Amazon, PayPal and Shopify exports, works out gross turnover, splits it into MTD periods and flags gaps and duplicates. Upload your exports and see your totals, quarters and Health Check free before you pay. Then £19 one-off for a workbook or £49 a year for unlimited workbooks. Paid workbook downloads open very soon; the free preview works now.

Try the free preview Get launch updates

Questions

Does the £1,000 trading allowance reduce qualifying income?

No. HMRC's announcement says turnover for the threshold is gross income before any tax allowances or expenses are deducted. HMRC also says you still keep digital records if you claimed the trading allowance and your income was over it.

My income dropped below £30,000 this year. Am I out?

The test uses the earlier return, so a lower current year doesn't change your start date by itself. HMRC's qualifying income page explains what happens if income falls or a business stops. Read it, or ask HMRC.

Is the £30,000 per platform?

No. It's the total across all your self-employment and property income.

Sources

This page is general information based on the GOV.UK guidance linked above, as it stood on 28 October 2026. It isn't tax advice. Rules and dates can change, so check GOV.UK or ask an accountant about your own situation. TidyTill isn't HMRC-recognised software and doesn't send anything to HMRC.

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