Are you in? It’s your takings, not your profit
Add up every invoice from the 2025/26 tax year – first and second fix, fitted kitchens, bespoke joinery, and the timber and hardware you supplied – at the full amount before CIS and before costs. If that total (plus any rent from property you let) is over £30,000, MTD applies from 6 April 2027. Over £50,000 and you have been in since April 2026.
Over £50,000
Over £30,000
Over £20,000
planned
Your work in accountant language
What actually happens in your working life, what your accountant and HMRC call it, and what to do about it.
| What happens | Accountant calls it | What you do |
|---|---|---|
| You invoice a contractor £1,200 for a week’s first fix | Gross turnover | Record the full £1,200 as income. |
| The contractor pays you £960 and keeps £240 | CIS deduction (20%) | Record £240 as tax already paid – not as an expense. |
| You get your CIS statement each month | Evidence of tax already paid | Keep every statement; they are totalled for the final declaration. |
| A homeowner pays for a fitted wardrobe, including materials | Turnover (private, no CIS) | Record the full amount. |
| You buy oak, sheet material and hinges | Allowable expense – materials | Keep the timber merchant invoice. |
| You buy a new mitre saw or track saw | Equipment – deductible in the year you buy it (cash basis) | Keep the receipt. |
| You pay rent on a small workshop unit | Allowable expense – premises | Keep the lease and payment records. |
| You move money to your personal account | Drawings – not an expense | It doesn’t reduce your tax. |
| Every three months / after 5 April | Quarterly update / final declaration | Send totals each quarter; the year is finalised and CIS set off by 31 January. |
What can a carpenter claim?
✓ Usually allowable
- Timber, sheet materials, hardware, glue and fixings used on jobs
- Power tools, saws, routers, nail guns and repairs
- Blades, bits, abrasives and other consumables
- Workshop rent, electricity and dust extraction
- Van running costs or 45p a mile – one method per vehicle
- Public liability and tools insurance
- CSCS card and safety training
- Protective boots, eye and ear protection, dust masks
- Business share of your phone bill
✗ Not allowable
- CIS tax deducted from your pay
- Timber for your own home projects
- Everyday clothes
- Travel to a site you attend every day for over 24 months
- Parking fines
- Money you take out for yourself (drawings)
Rules that matter for carpenters and joiners
The CIS chain in your records
Each CIS job has three numbers: the gross invoice (your turnover), the 20% deduction (tax already paid – 30% if you are unregistered), and the net payment (what hits your bank). Only the gross figure counts for MTD. Materials you supply and show separately are not deducted from.
Workshop costs
If you have a separate workshop, its rent and bills are business costs. If you work from a garage at home, you can usually claim a reasonable share of household running costs, or use HMRC’s flat rate if you work from home enough hours.
Stock and part-finished jobs
Under the cash basis you generally claim timber when you pay for it. If you take stage payments on a big job, record each one as income when it arrives.
Worked example
Tom, a carpenter and joiner in Exeter (illustrative example)
| Takings (turnover) | £43,500 |
| less Timber, sheet materials and hardware | −£7,400 |
| less Van fuel, insurance and servicing | −£3,900 |
| less Tools, blades and consumables | −£1,800 |
| less Workshop rent and electricity | −£2,400 |
| less Insurance, CSCS and phone | −£950 |
| Profit | £27,050 |
| Income tax (estimate) | £2,896 |
| Class 4 National Insurance (estimate) | £869 |
| Total tax for the year | £3,765 |
| Put aside each month | £314 |
Estimate for 2026/27 using England, Wales & NI rates, assuming no other income. Scotland has different income tax bands.
What a quarterly update looks like
A typical quarter for a carpenter: add up your invoices and stage payments, enter each CIS statement, match timber merchant invoices to jobs, add workshop bills and mileage – then submit through your software, or let your accountant do it. Keeping a simple job sheet per project makes the materials side easy.
| Quarter | Period | Submit by |
|---|---|---|
| Q1 | 6 Apr – 5 Jul | 7 Aug |
| Q2 | 6 Jul – 5 Oct | 7 Nov |
| Q3 | 6 Oct – 5 Jan | 7 Feb |
| Q4 | 6 Jan – 5 Apr | 7 May |
| Final declaration | The whole tax year | 31 Jan following |
Quarterly updates are summaries – they don’t change when you pay. Tax is still due by 31 January (plus payments on account on 31 January and 31 July if they apply to you).
What will an accountant cost?
Typical monthly fees under MTD for Income Tax for: Construction trades (often CIS).
| Option | What you get | Per month |
|---|---|---|
| You do it yourself | MTD-compatible software. You keep the records and send the updates. | £0–£15up to £180 a year |
| Accountant files for you | You keep records in an app; they check them, send the 4 quarterly updates and the final declaration. | £35–£70about £420–£840 a year |
| Full service | They do the bookkeeping too – you share receipts and bank feeds, they handle the rest. | £70–£130about £840–£1,560 a year |
What pushes the price up: matching CIS statements and claiming back tax that was over-deducted; records kept on paper rather than in an app; being VAT-registered; catching up on missed updates or late returns.
What a fixed-fee quote should include
- All 4 quarterly updates and the final declaration (your tax return)
- The MTD software licence – or whether you pay for it separately
- Whether they do the bookkeeping or only check what you’ve recorded
- A reminder before each deadline and an estimate of the tax to put aside
- Whether VAT (20%) is added on top – not every practice charges it
Accountancy fees for your business are an allowable expense, so they reduce your tax bill.
Indicative ranges from published UK price lists, checked October 2026. Not a quote – your fee depends on how many transactions you have, how tidy your records are and where you live.
Questions carpenters and joiners ask
My take-home after CIS is under £30,000. Am I still in?
Possibly. MTD uses the gross amount before CIS was deducted. If your invoices total over £30,000, you are over the threshold even if less reached your bank.
Can I claim tools I bought before I went self-employed?
Tools you already owned and start using in the business can often be claimed. Ask whoever does your accounts how best to record them.
Do I need separate software for CIS?
No. Most MTD software lets you record CIS deductions alongside your income and expenses.
I’m on gross payment status. What changes?
Nothing is deducted, so there is nothing to set off at the end of the year. Your full tax bill is due on the normal dates.
Sources
- Find out if and when you need to use Making Tax Digital for Income Tax – GOV.UK
- Work out your qualifying income for Making Tax Digital for Income Tax – GOV.UK
- Send quarterly updates using Making Tax Digital for Income Tax – GOV.UK
- Find software that works with Making Tax Digital for Income Tax – GOV.UK
- Penalties for Making Tax Digital for Income Tax – GOV.UK
This guide is general information about HMRC’s Making Tax Digital rules as of 26 October 2026, not tax advice. MTD Match is an independent introduction service and is not affiliated with HMRC. Check gov.uk or speak to an accountant about your own situation.