Sole trader accounting software

MTD-ready sole trader accounting software

Maintain digital records

Create and send professional invoices instantly from anywhere, track their status, and get paid online for your hard work.

Bank feeds

Connect your bank account to securely access automatic, real-time bank feeds, keeping your financial data consistently up to date. You can also reconcile transactions with minimal effort.

Smart Receipt Scanning Made Simple

Zoho Books Auto Scan lets you upload receipts while it intelligently extracts key information, helping you stay organized and streamline your bookkeeping with minimal effort.

Prepare for Self Assessment

You can generate a self-employment summary report in Zoho Books based on SA103S or SA103F formats to help calculate and prepare your Self Assessment return. It’s a simple way to track your income and expenses ahead of MTD for Income Tax in 2026.

Simple steps to file income tax returns

Step 1: Set up Income Tax in Zoho Books

Choose "Income Tax" under the Taxes module, enter your National Insurance number, and select your business.

Step 2: Generate quarterly updates

Zoho Books will automatically fetch your obligations, and based on them, updated entries will be made available. Map your relevant accounts including income and expenses, for the quarterly filing.

Step 3: Review your income and expenses

Based on your mapping, Zoho Books will let you know the consolidated income and expenses in the review page. You can review the number and then generate the quarterly update.

Step 4: Send quarterly updates to HMRC

Once generated, finalize the quarterly update and send it to HMRC.

More actions in our sole trader accounting software

File VAT returns with Zoho Books

Zoho Books grows alongside your business. Under the government mandate, you are required to submit VAT returns to HMRC with an MTD-compatible software. Zoho Books comes to the rescue. Explore all Zoho Books plans here.

Tax filing made easy with your accountant

Your accountant or tax agent can file Income Tax or VAT returns on your behalf directly through Zoho Books. This way, you can streamline operations and also stay compliant.

Monitor CIS transactions as a subcontractor

Track CIS as a subcontractor by marking customers as contractors and applying CIS deductions to invoices. View detailed CIS suffered reports to stay compliant and simplify your tax filings.

Why Zoho Books for sole traders?

Online accounting, simplified

Get a complete picture of your financials, generate powerful reports, and manage your accounting from anywhere, anytime.

One software for all your collaboration

Enable our customer portal to share recent transactions, collaborate with them to expedite quote approvals, and help them make bulk payments.

Improve accuracy

Whether your are submitting Income Tax or VAT returns, Zoho Books helps you accurately calculate the amount you owe to HMRC.

Automate repetitive tasks

Set up recurring invoices, automate payment reminders, and trigger unique workflows that work for your business.

Need assistance?

We understand how tedious it can be to move data from one software to another. That is why our migration support makes it easier for you.

Contact us

Connect with our product experts for personalized guidance and support

Schedule a consultation

Find an accountant

Search for expert accountants to manage your books and streamline your finances.

Connect with financial experts

Help Documentation

Get detailed documentation of MTD for IT in Zoho Books, along with FAQs

Visit our knowledge base

Frequently Asked Questions

A sole trader in the UK is essentially any individual who is self-employed and runs their business as an individual. You must be registered as a sole trader with HMRC if your earnings during the tax year exceed £1,000.
You will be required to pay income tax if you are registered as a sole trader with HMRC. Previously, you would have manually filled out and submitted the self-assessment form online. The shift to MTD for Income Tax frees you from filling in the details manually. From April 2026, if you are a sole trader and your annual turnover exceeds £50,000, you are required to file income tax returns with an MTD-compliant accounting software.
Zoho Books additionally offers the SA103F/S Summary, which you can generate as per your requirement to help with self-assessment and ensure a smooth transition when the time comes.
HMRC's Making Tax Digital (MTD) for Income Tax initiative empowers sole traders to maintain digital records of their business transactions and simplify income tax filing with the help of online accounting software.From April 2026, sole traders with an annual income over £50,000 must submit their income tax returns with HMRC-recognised accounting software. You can start maintaining digital records for your business to submit quarterly returns from 2026.
Yes, Zoho Books offers a free plan for sole traders to help streamline their accounting processes and ensure compliance with government regulations.The plan includes:
- Digital records with audit trails to ensure accuracy and transparency
- Preparation for self-assessment (SA103F, SA103S).
- Income tax filing for sole traders
- Direct VAT filing to HMRC
and many more. To access the free plan, check out:
Whether you’re a VAT-registered sole trader or not, Zoho Books makes it easy to stay on top of all your MTD for Income Tax obligations. Create invoices, track expenses, and submit quarterly updates - all for free, forever.
Our free plan helps VAT and non-VAT registered sole traders submit income tax returns directly to HMRC. However, as your business grows and graduates to an LLP or limited company, we have plans that might work for you.
If you are already looking for some advanced features, see our pricing plans to find out what works best for you.
Yes, you can have your accountant handle your income tax returns. Our free plan gives both you and your accountant full access to your Zoho Books account. If you need an accountant, you can easily find one nearby to support you with your MTD requirements here.
If you are an accountant or a bookkeeper with your own firm, we also offer a practice management solution for bookkeepers and accounting firms through Zoho Practice, which seamlessly integrates with the Zoho Books accounting platform. This integration makes it easier to capture your clients financial insights directly within your practice dashboard and manage them efficiently from a single place. Become a partner to discover additional benefits for your company and clients.

Accounting Across Devices

Introducing Zoho Practice

BOOKS ACADEMY

FEATURED GUIDE

A guide to MTD for IT