MTD for Authors & Self-Published Writers —
Royalties, Advances and Your Threshold
Use gross royalties as shown on statements, converted to pounds, before agent fees and costs. Salaried income is not included.
- Royalties, advances, self-publishing platform income and writing fees all add together. The test is on the gross total before your agent, editor and cover costs.
- Foreign royalties count. Amazon KDP, Audible and other overseas platforms pay in other currencies, and the pound value is part of your income.
- Publishers usually pay royalties twice a year, so your quarterly updates will show income in some quarters and little in others.
A published author or a self-publisher with several platforms has a lot of small streams, and they all add together for Making Tax Digital. Royalties from a publisher, income from Amazon KDP and Audible, Public Lending Right and ALCS payments, events and subscriptions are counted before your agent’s commission and before editing and cover design costs. This guide covers what counts, how royalty timing affects quarterly updates, and the records to keep.
Are Authors in MTD?
If you write for a living or as a trade and your gross income (plus any property income) is over the threshold for the relevant tax year, yes. The first line was £50,000, tested on your 2024–25 return:
| Tax Year Tested | Gross Income Over | MTD Start Date |
|---|---|---|
| 2024–25 | £50,000 | 6 April 2026. Live now |
| 2025–26 | £30,000 | 6 April 2027 |
| 2026–27 | £20,000 | 6 April 2028 |
Most authors are below the first two lines. The £20,000 line, planned from April 2028, matters most to authors earning from several smaller streams, because the combined total is easier to pass than any one stream. Treat the plan as confirmed government policy with legislation to follow.
Which Writing Income Counts
| Income | Counts towards the threshold? |
|---|---|
| Royalties from a publisher, as shown on royalty statements | Yes |
| Advances | Yes, timing depends on your basis |
| Self-published income from KDP, Kobo, Apple Books and Draft2Digital | Yes, in pounds |
| Audiobook royalties (ACX, Audible) | Yes |
| Public Lending Right and ALCS payments | Generally yes |
| Events, talks, workshops and festival fees | Yes |
| Patreon, Substack or other reader subscriptions | Yes |
| Salary from a teaching or day job | No |
Treat advances carefully. When an advance is counted depends on your accounting basis and the contract, so ask your accountant before the first quarterly update. Foreign royalties are part of the total in pounds, even where tax was withheld abroad. Keep the statements that show the withholding.
Royalty Timing and Quarterly Updates
Publisher royalties typically arrive twice a year, and platform payments arrive monthly, often one or two months after the sales period. That means your records will show uneven income, and that is fine. A quarterly update reports whatever is in your records for the period, so a quarter with only a small platform payment is a short update.
Log each payment with the source, the period it covers, the gross amount, any withholding and the date received. For overseas platforms, record the pound value on the day the money reached your bank.
What Authors Can Claim
| Expense | Notes |
|---|---|
| Editing, proofreading and cover design | Fees paid to freelancers for your own titles |
| ISBNs, formatting and distribution | Bowker or Nielsen ISBN costs and formatting tools |
| Advertising and promotion | Amazon ads, BookBub, newsletter services, review copies |
| Agent commission | Expense; record the gross royalty first |
| Research costs | Books, archives, travel linked to a specific work |
| Software and subscriptions | Scrivener, Vellum, website hosting, email tools |
| Events and conferences | Tickets, travel and stand costs |
| Membership fees | Society of Authors, ALCS and similar bodies |
Writing from home is common, and a proportion of home costs can be claimed. HMRC’s flat rate for use of home is £10, £18 or £26 a month depending on your hours, which is simpler than apportioning bills.
| Update | Period (standard) | Deadline | 2026–27 |
|---|---|---|---|
| Q1 | 6 Apr – 5 Jul 2026 | 7 Aug 2026 | No points if late |
| Q2 | 6 Jul – 5 Oct 2026 | 7 Nov 2026 | No points if late |
| Q3 | 6 Oct 2026 – 5 Jan 2027 | 7 Feb 2027 | No points if late |
| Q4 | 6 Jan – 5 Apr 2027 | 7 May 2027 | No points if late |
The soft landing means no late-update points until 6 April 2027. After that, one point per missed deadline and a £200 fixed penalty at four points. HMRC has also been signing up eligible customers since September 2026, so get ahead of it and register yourself. See the registration guide and the software comparison.
Worked Example
Hannah Doyle, crime author with a publisher and a self-published backlist
Hannah’s agent commission, editing and cover costs lower her taxable profit but not the £39,250 total. That puts her over £30,000 for 2025–26, so she joins MTD from April 2027 and can use the months before then to set up her records.
Frequently Asked Questions
Do authors have to use Making Tax Digital?
If your gross writing income plus any property income was over £50,000 in 2024–25, yes, from 6 April 2026. Over £30,000 in 2025–26 means April 2027, and over £20,000 in 2026–27 means April 2028.
Do I count royalties before my agent takes commission?
Yes. Use the gross royalty shown on the statement. Agent commission is an expense against your income and does not reduce the figure used to test the threshold.
How are Amazon KDP and foreign royalties counted?
Use the pound value of what you were paid. Overseas platforms pay in other currencies, and any tax withheld abroad should be kept on record, but the gross income is part of the total.
Do PLR and ALCS payments count?
They are generally treated as part of your writing income, so include them. Keep the payment statements with your royalty records.
How do I record an advance?
When an advance counts depends on your accounting basis and the contract. Ask your accountant before the first quarterly update so you record it in the right period.
I have a day job as well. Does my salary count?
No. Only self-employed and property income counts. Your salary through payroll is left out, though your writing income is added to any other self-employed or rental income you have.
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