Making Tax Digital for Virtual Assistants —
Combining Retainers, Platforms & Home Office Costs
Combine monthly retainers, project fees and platform work (Upwork, Fiverr) into one gross total, before software or subcontractor costs.
A typical VA business is a patchwork: a few monthly retainer clients, the odd project-based job, maybe some work found through Upwork or Fiverr. None of that changes whether MTD applies, but working out how it all adds up, and what HMRC already knows about you, is where most confusion sits.
- All your retainer clients and project work are usually one self-employment business, added together
- Since January 2024, platforms like Upwork and Fiverr report your earnings to HMRC automatically
- Home office costs and subcontracted VAs helping with client work are normally allowable
Every Retainer Counts Towards the Same Threshold
Five clients paying £400 a month each feels like five small, separate incomes. For MTD purposes, it's one self-employment business earning £2,000 a month, and every client's payment is added together as a single gross income figure against the threshold. This is the single most common miscalculation VAs make when estimating whether they're close to needing MTD.
Platforms Already Report What They Pay You
If any of your work comes through Upwork, Fiverr, or similar marketplaces, HMRC already has visibility of it. Since January 2024, UK digital platforms are required to report what they've paid their users to HMRC annually, under international reporting rules that apply across the platform economy.
Home Office & Subcontracting
| Expense | Typically allowable? | Note |
|---|---|---|
| Home office proportion (heating, electricity) | Yes | Flat rate or calculated proportion |
| Software subscriptions (project management, design tools) | Yes | Tools used for client work |
| Subcontracted VAs, copywriters, designers | Yes | Genuine subcontractors, not your employees |
| Courses and training relevant to your services | Yes | Must relate to your existing VA business |
| Laptop, monitor, office equipment | Yes | Business proportion if also used personally |
| Platform commission (Upwork, Fiverr fees) | Yes | Deduct the fee, declare the gross amount as income |
Records for Retainers, Platforms and Subcontractors
Virtual assistants usually have several retainer clients, sometimes platform work and sometimes a subcontractor for overflow. Records should show each.
- Record each client, the retainer and every invoice.
- Record platform income gross, with the fee as a cost.
- Keep subcontractor invoices as costs, and record your own invoice to the client.
- Keep software, communication and training costs.
- Keep home office and equipment receipts.
A Sample Quarter: What the Update Looks Like
A sample quarter for a VA with five retainer clients and an occasional project.
| Q2: 6 July to 5 October 2026 | Amount |
|---|---|
| Retainer clients | £7,400 |
| Platform work (gross) | £1,300 |
| Project and one-off tasks | £1,500 |
| Total income | £10,200 |
| Subcontractor | £1,100 |
| Software and tools | £540 |
| Platform fees | £130 |
| Training and home office | £420 |
| Total expenses | £2,190 |
| Profit for the quarter | £8,010 |
A subcontractor is a cost, and the full fee you invoice to the client is your income.
Worked Example
Priya — VA with three retainer clients plus occasional Upwork projects
All four income streams combine into Priya's single self-employment total. £31,360 is under the current £50,000 threshold but above the £30,000 threshold arriving April 2027, so she'll need to prepare based on this year's figures.
Best MTD Software for Virtual Assistants
Software links are affiliate, help fund CheckMyMTD. Recommendations based on ease of use for self-employed income tracking.
Frequently Asked Questions
Do I combine income from all my retainer clients for the MTD threshold?
Yes. If you're self-employed, all your VA income, whether from monthly retainers, hourly billing, or one-off projects, is normally the same self-employment business, so it's added together as one gross income figure against the MTD threshold.
Does income from Upwork or Fiverr get reported to HMRC automatically?
Yes. Since January 2024, UK digital platforms including Upwork and Fiverr must report what they've paid you to HMRC annually under OECD reporting rules. This doesn't change what tax you owe, but HMRC already has the figures, so your own records need to match.
Can I claim home office costs as a virtual assistant?
Yes. You can claim a proportion of household costs like heating and electricity for the room you work from, either using HMRC's simplified flat rates or by calculating an actual proportion based on room use and hours worked.
If I pay other VAs or freelancers to help deliver client work, can I claim that?
Yes. Payments to subcontractors, such as a copywriter, designer, or junior VA helping deliver work under your client contracts, are normally allowable business expenses, provided they're genuinely self-employed subcontractors rather than your employees.
I use my own limited company. Does MTD for Income Tax apply to me?
Not to your company's trading income, which is taxed through Corporation Tax instead. MTD for Income Tax only applies to individuals with self-employment or property income in their own name, so it would only be relevant if you also have separate personal income outside the company.