Working on cloud accounting software on a laptop

Making Tax Digital (MTD) is HMRC's long-running plan to move the tax system onto digital records and more frequent reporting. It already applies to VAT, and from April 2026 it starts to reach income tax for sole traders and landlords. Getting ready in good time is far easier than being caught out as a deadline approaches.

Where does Making Tax Digital stand today?

MTD does not change how much tax you pay. It changes how you keep your records and how you report them. In practice that means holding your figures in software rather than on paper or in a spreadsheet on its own, and sending your information to HMRC digitally through a compatible program.

MTD for VAT, already in force

Every VAT-registered business has to keep digital VAT records and file returns through MTD-compatible software. If you are registered for VAT, this applies to you now, whatever your turnover. We take care of it as part of our VAT returns service.

MTD for Income Tax, from April 2026

From 6 April 2026, MTD for Income Tax applies to sole traders and landlords with qualifying income over £50,000. Instead of filing one Self Assessment return a year, you will keep digital records, send HMRC quarterly updates, and make a final declaration once the year ends. The government has announced further phases for qualifying income over £30,000 from April 2027 and over £20,000 from April 2028. Those later phases are planned policy, so we confirm the current thresholds and timing with GOV.UK and HMRC before we advise you, as they can change.

How we help you get ready

Choosing your software

We help you pick MTD-compatible software that suits the way you work, whether that is Xero, QuickBooks, FreeAgent or a bridging tool.

Setting up digital records

We move your records into software, connect your bank feeds and make sure the data is captured in the right form.

Quarterly updates

We prepare and submit your quarterly updates, so each deadline passes without a last-minute scramble.

Training and support

Hands-on help so you and your team are comfortable keeping your records up to date as you go.

Year-end finalisation

We handle the final declaration that pulls the whole year together and confirms your tax position.

Staying compliant

We keep you in step with the rules as each phase rolls out, so nothing takes you by surprise.

Who has to prepare for MTD, and when?

Most businesses and landlords will be brought in eventually, but the timing depends on your situation:

  • VAT-registered businesses, already inside MTD for VAT and filing digitally today.
  • Sole traders and landlords over £50,000, brought in from April 2026 under MTD for Income Tax.
  • Those over £30,000, due to follow from April 2027 under the announced plans.
  • Those over £20,000, a later planned phase from April 2028, still subject to confirmation.
  • Still on spreadsheets or paper, you will need digital records and compatible software before your start date.
What counts as qualifying income? For MTD for Income Tax, it is broadly your gross trading and property income before expenses, not your profit. If you have more than one source, say self-employment plus income from rental property, they are added together when you test the threshold. We work this out with you so you know exactly which deadline applies to you.

Why it pays to start early

The businesses that find MTD easy are the ones already keeping clean digital records. If you move to cloud accounting ahead of your start date, each quarterly update becomes a quick review rather than a frantic rebuild of the whole year. You also get a live view of profit and tax as you go, which is genuinely useful well beyond ticking the compliance box. And if you want to go further and tidy up the whole finance process, our digital transformation support can help.

Our three-step path to MTD

1

Assess your position

We confirm which MTD rules apply to you and when, based on your income sources and your registrations.

2

Set up and switch

We put compatible software in place, move your records across, and make sure the bank feeds and categories are right.

3

Run the cycle with you

We handle the quarterly updates and the final declaration, keeping you ready for every deadline.

Getting North East businesses MTD-ready

Across Newcastle and the North East, we work with sole traders, landlords and small companies who want MTD dealt with without it eating into the day job. Whether you are a landlord in Jesmond with a handful of properties or a tradesperson coming up to the income threshold, we will tell you plainly what you need to do and by when, then take the work on for you.