How do I overcome MTD setup failing at the final stage (5) where Tax Periods are set? In my case these were previously set with HMRC by earlier tax submissions this year.

Hi there, @lisanish21. Thank you for sharing the details! 

Based on what you've mentioned about your tax periods being previously set with HMRC through earlier submissions, I wanted to explore a few possibilities to help.

Since QBO Sole Trader does not support Making Tax Digital (MTD) for VAT submissions, could you have previously used a different QBO subscription, such as Simple Start, Essentials, Plus, or Advanced? If you had another account in the past or currently using a different plan, this could explain your prior ability to manage VAT submissions directly with HMRC.

However, if you're using another QBO account that supports MTD but are encountering issues while setting up, this can be due to a browser-related issue. To troubleshoot, you can start by refreshing your browser by pressing Ctrl+R or Command+R. A session refresh often resolves temporary issues. Also, you can access your account using a supported browser. 

I’ll keep an eye on this thread, so feel free to share any additional questions or concerns.

Hi Rusimyhr,

Thanks for your reply.

Scenario 1 you mention, MTD for VAT is not the case for me. I am not VAT registered and am only seeking to connect QBO to HMRC for income tax purposes, not VAT.

We have ruled out scenario 2, a browser related issue, as used fresh Edge and Chrome (including incognito)  browser sessions with identical results during the setup process.

In terms of additional information - we are pretty sure the MTD setup is failing before completion at step 5 as when checking my advanced settings area of QBO there are no entries for MTD settings.

My two prior quarterly tax submissions this year were made using Clearbooks and Standard Quarterly tax submission periods were set with HMRC whilst using that software. We wonder whether your pilot MTD setup program can cope with pre-configured HMRC tax periods or whether it is assuming QBO users have not previously set these?

Finally, given the earlier MTD setup steps of QBO authentication against my HMRC Tax account were successful I tried to find a way of disconnecting QBO from the HMRC Tax Account side in order to start the setup process afresh but could not do this.

Any help you can offer greatly appreciated.

Hi there, Lisa. Thank you for providing detailed context regarding the issue you're facing when trying to set up Making Tax Digital (MTD) for Income Tax purposes with QuickBooks Online (QBO).     

First, confirm that your version of QuickBooks Online supports MTD for Income Tax Self-Assessment (ITSA). Not all QBO products currently handle MTD ITSA. If you are working with QBO’s pilot program, verify whether your account is set up for ITSA or if additional settings need to be configured.         
 

Given your concern about previously configured tax periods in HMRC from using Clearbooks, check whether QBO assumes users have no prior submissions during the pilot setup. This might be causing a conflict during the enrollment process.   

If your HMRC account is set to calendar periods, HMRC automatically defaults the first quarterly period for MTD submissions to begin on the 6th of April in the first year of the election. This is expected behavior based on HMRC guidelines and has caused confusion for many users. QuickBooks does not rely on dates from its own system but instead uses the obligation dates provided directly by HMRC.     

To address this and ensure records align with the selected calendar quarter:      

Option 1 (Recommended by HMRC): Use the Business Source Adjustable Summary (BSAS) at year-end to adjust any accounting records missed during quarterly updates. This ensures compliance and accuracy with HMRC rules.   

Option 2: Shift digital records for the period from 1st April to 5th April to start on the 6th April, especially for cash basis records.   

Option 3: Use journal entries to adjust records as needed.     

For further assistance in setting up the proper period, feel free to contact our phone support team for detailed guidance.    

An error during the National Insurance Number input or authorization with HMRC is often due to incorrect credentials, such as using a Self-Assessment login instead of the required Agent Services Account (ASA). Since earlier steps of authentication with HMRC were successful, this may not be the issue, but it’s worth reconfirming you are using ASA credentials for MTD ITSA enrollment. To resolve the problem or retry the setup, disconnect the integration entirely by visiting https://qbo.intuit.com/app/itsa/setup?disconnect=true.       

Please don’t hesitate to reach out if you require further assistance or clarification moving forward with setting up MTD for ITSA successfully. We’re here to help you.