Making Tax Digital (MTD)
HMRC's move to digital tax is already changing how businesses, sole traders and landlords keep records and report income. Here's what's changing, who it affects, and how we make it straightforward.
Thinking you're compliant isn't the same as being compliant
A lot of businesses assume that using cloud software or keeping a spreadsheet is enough. In practice, MTD has specific requirements around digital record-keeping, software links to HMRC, and how often you report — and it's easy to fall short without realising.
If you're not sure exactly where you stand, that's exactly what we're here for.
What is Making Tax Digital?
MTD is HMRC's ongoing programme to move tax reporting away from annual paper-based returns and towards continuous digital record-keeping, submitted through compatible software.
Digital records
Income and expenses kept digitally in MTD-compatible software, rather than paper books or standalone spreadsheets.
Regular updates
Summaries sent to HMRC throughout the year, instead of one big return after the year has ended.
Direct HMRC link
Our software connects securely to HMRC, cutting down manual re-entry and the errors that come with it.
Who has to comply, and when
Thresholds and dates are set by HMRC and can be revised — get in touch and we'll confirm exactly where you stand.
MTD for VAT
Mandatory since April 2022 for all VAT-registered businesses, regardless of turnover.
Income over £50,000
Sole traders and landlords with qualifying income above £50,000 must now keep digital records and submit quarterly updates.
Income over £30,000
The threshold drops further, bringing more sole traders and landlords into MTD for Income Tax.
What you'll actually need to do
-
Keep digital recordsIncome and expenses logged in MTD-compatible software as you go, not reconstructed at year-end.
-
Send quarterly updatesA running summary of income and expenses submitted to HMRC every three months.
-
File an End of Period StatementOne per business or property, finalising the figures for the tax year.
-
Submit a Final DeclarationThis replaces the old Self Assessment return, confirming your total tax position for the year.
We handle MTD, so you don't have to
From getting set up to submitting on time, every quarter — without the software headaches.
Software set up for you
We get you onto dedicated MTD software, connected to HMRC and configured correctly from day one.
Quarterly updates handled
We prepare and submit every quarterly update on time, so deadlines never catch you out.
Penalty-free peace of mind
Year-round support so your records stay accurate and HMRC's points-based penalties stay someone else's problem.
Common questions about MTD
Do I need to do anything right now?
If your self-employment or property income is above £50,000, MTD for Income Tax applies to you now. Below that, it's worth planning ahead of the April 2027 threshold drop. We can confirm exactly where you stand.
What software do I need?
Any HMRC-recognised MTD software works — we set up and support dedicated MTD software for you, and can migrate your existing records across.
I'm already VAT registered — does this affect me too?
MTD for VAT and MTD for Income Tax are separate obligations. If you're a VAT-registered sole trader or landlord above the income threshold, both can apply.
What happens if I miss a deadline?
HMRC uses a points-based penalty system for late submissions and payments. Points build up and convert to financial penalties — we manage your deadlines so this doesn't happen.
Not sure if MTD affects you?
Book a free, no-obligation consultation and we'll tell you exactly what applies to your business and by when.