MTD for Seasonal and Intermittent Businesses: Managing Irregular Income and Exhibition-Only Trading

What this guide covers

This article explains how Making Tax Digital for Income Tax (MTD ITSA) affects seasonal, intermittent and exhibition-only traders. It walks through the 2026–2028 rollout dates, the practical record-keeping and quarterly-update approach for businesses with irregular income, and clear steps you can take now to stay compliant and reduce stress.

Quick reminder: the MTD ITSA rollout and what it means

From April 2026 MTD for Income Tax starts its staged rollout for self-employed people and landlords. The key dates are:

• April 2026: taxpayers with annual income over £50,000 enter MTD ITSA.
• April 2027: threshold falls to £30,000.
• April 2028: threshold falls to £20,000.

‘Income’ here means total business and property income, not profit. If you run a seasonal business or trade only at exhibitions, you still need to check your annual income against these thresholds. If you fall above the threshold for the relevant tax year, you must send quarterly digital updates through MTD-compatible software and finalise your tax return digitally at year end.

Why seasonal and intermittent traders should prepare now

Seasonal sellers and exhibition-only traders often have peaks and troughs. That irregularity can make quarterly reporting feel awkward, but MTD is built to handle variable income. Preparing now means:

• you choose software and a workflow that tracks income as it comes in, reducing end-of-year pressure;
• you avoid surprises if a strong season pushes you over a threshold; you’ll already be set up to submit quarterly updates; and
• you reduce the risk of penalties for late or incorrect digital submissions.

Common scenarios and how MTD applies

Here are typical examples and what to do in practice.

1. Exhibition-only trader (e.g. craft markets, trade fairs)

Most income comes from a handful of events each year. Under MTD you will still:

• keep digital records of each sale, stall fee, material cost and travel expense;
• submit quarterly updates reporting the income and expenses for that period;
• finalise at the year end by reconciling the quarterly submissions to your profit and loss and making any adjustments (capital allowances, disallowable expenses, personal drawings, etc.).

2. Seasonal business (e.g. summer-only tourism stall or winter market trader)

Your income will be concentrated in particular months. The practical steps are the same, but you should plan for months with low/zero trading:

• use software that records nil activity cleanly: you can submit a quarterly update with zero or minimal figures rather than leave gaps;
• keep a simple calendar of expected trading months so you know when higher-value quarters will occur; and
• consider smoothing cashflow between quarters (see cash management tips below).

How to manage irregular income in quarterly updates

MTD ITSA requires four digital submissions each tax year. Each submission covers the period of the quarter and shows the totals for income and allowable expenses. It does not replace your final year-end calculation; it’s an interim update.

Practical tips for irregular income:

• Report actuals for the quarter: if you earned £8,000 at an exhibition, include the full amount in that quarter’s update.
• Record all costs digitally when they occur: travel, stall hire, stock, promotional materials. That makes reconciliation easier.
• Submit nil or low-value updates for quiet quarters rather than leaving periods blank. HMRC expects consistent reporting.
• Keep a short narrative file for unusual items (large one-off sales, refunds) so you can explain adjustments at year-end if asked.

Practical bookkeeping workflow for exhibition and seasonal traders

A simple, robust workflow reduces time spent on returns and lowers risk of errors.

• Choose MTD-compatible software with bank feeds and receipt capture. Bank feeds reduce manual entry and help match payments to sales or refunds.
• Set up products or projects for each event or season. This lets you see which fairs or months are most profitable.
• Capture receipts at point of purchase using a phone app. Tag them to the correct cost category (materials, travel, stall fee).
• Reconcile bank accounts weekly or fortnightly. Regular reconciliation catches missed income or duplicated entries early.
• Prepare a simple quarterly pack: income summary, expense list and any prepayments or accruals to declare at year-end.

Example: How quarterly updates work for an exhibition trader

Olivia sells handmade jewellery at exhibitions. She trades mainly in Q2 and Q3 and makes £36,000 across the tax year, with most income in Q2 and Q3. Her quarterly updates might look like this:

• Quarter 1 (Apr–Jun): Income £18,000, expenses £6,000.
• Quarter 2 (Jul–Sep): Income £16,000, expenses £5,000.
• Quarter 3 (Oct–Dec): Income £1,000, expenses £500 (few winter sales).
• Quarter 4 (Jan–Mar): Income £1,000, expenses £1,500 (prepaid materials for next season).

At year-end Olivia finalises her tax using the four quarterly updates plus any adjustments for capital allowances and personal allowances. Because she used software with projects for each event, she can see which fairs made a profit and simplify pricing decisions for next year.

Dealing with one-off large sales or irregular spikes

A single large order or an unexpectedly busy festival can push you into a higher tax bracket or over the MTD threshold. Actions to take:

• Log the sale quickly and tag it correctly in your software.
• Consider whether the sale is part of normal trade or a one-off capital item (treat differently for tax).
• If the spike moves your projected income above the MTD threshold for the next tax year, set up quarterly submissions early so you are ready from the start of the next relevant year.

Choosing software when your trade is intermittent

Look for these features:

• Simple receipt capture and project/event tagging so you can separate exhibitions or seasons.
• Bank feeds and automatic categorisation to reduce manual work on busy days.
• Ability to file quarterly updates directly to HMRC (MTD compliant).
• Clear reporting for cash vs accrual accounting—choose the basis that reflects how you manage money (see section below).
• Good mobile experience so you can update records from a stall or show venue.

Cash vs accrual accounting: which is right for you?

Under MTD ITSA you can use cash or accruals basis. For most small, seasonal traders the cash basis is the simplest: you record income and expenses when money actually moves. Accruals record invoices and bills when issued or received, which can give a truer picture of performance but is more admin-heavy.

Choose cash basis if:

• you want simpler bookkeeping and clearer cashflow insight;
• your stock levels are low or simple to track.

Choose accruals if:

• you carry significant stock or send/receive invoices that span accounting periods;
• you need tighter matching of income and related costs for management decisions.

Smoothing cashflow across quarters

Irregular income can cause short-term cashflow problems between exhibitions. Some practical measures:

• Keep a small buffer in a separate bank account for quiet months.
• Use simple short-term business credit (overdraft, card) sensibly for stall deposits or stock ahead of busy season.
• Consider invoicing early for wholesale or bespoke orders where appropriate, and record deposits digitally.

Record retention, evidence and audit readiness

Even small traders must keep adequate records. For MTD those records must be digital and must link to your submitted quarterly updates. Keep:

• digital copies of sales records and receipts (photographs are acceptable when clear);
• a log of event dates and stall fees; and
• evidence of travel costs and accommodation when claims are made.

Retain these records for the usual statutory periods. If HMRC asks for clarification, a tidy digital record will speed up resolution and reduce stress.

Common questions seasonal and exhibition traders ask

Do I have to send quarterly updates if I trade only a few days a year?

Yes, once you are within the MTD threshold for the relevant year you must submit quarterly updates. You may have quarters with nil or very low figures; submit updates for those periods rather than leaving gaps.

Can I keep using spreadsheets?

Spreadsheets alone are no longer sufficient for most businesses within MTD. HMRC requires MTD-compatible software that can send digital updates. Some software integrates with spreadsheets or offers spreadsheet import, but the final submissions must travel from approved software.

What about seasonal stock or prepayments for next season?

Prepayments and stock need careful treatment at year-end. If you use cash basis, stock is usually only adjusted in simple ways; accruals require more detailed calculations. Make sure your software captures opening/closing stock and prepaid expenses so year-end adjustments are accurate.

Penalties and reasonable excuse

HMRC retains penalties for late or missing submissions. If you have a genuine technical problem or another reasonable excuse, document it and contact HMRC early. Keeping records up to date and using reliable software reduces the chance of penalties.

Practical checklist for getting ready

• Estimate your total annual income now to see which MTD date applies to you (Apr 2026/27/28).
• Choose MTD-compatible software with mobile receipt capture and bank feeds.
• Set up projects or event tags for each exhibition so income and costs are clearly separated.
• Create a simple rutine to reconcile bank transactions at least monthly during busy seasons.
• Prepare to submit quarterly updates even if some quarters are nil; keep a short explanation file for any unusual items.
• Plan cashflow around quiet periods: maintain a buffer and consider short-term finance options if needed.

When to ask for help

If your trading pattern is complex — for example you have multiple income streams, overseas sales, or significant capital expenditure — speak to a qualified accountant early. They can help set up the right software, get your tagging and projects correct, and ensure your quarterly updates and year-end finalisation are accurate.

Final thoughts: keep things simple and digital

MTD ITSA doesn’t aim to make life harder for seasonal or exhibition-only traders. It does mean switching to a digital workflow and sending quarterly updates. With the right software and a few practical habits you can make compliance straightforward. Tax Digital makes compliance easy. We take the stress away so you can focus on trading seasons and exhibitions with confidence.