Making Tax Digital
software

MTD software is designed to help businesses and practices comply with HMRC’s digital tax requirements. You can use it to maintain records, submit VAT returns, and manage your Income Tax filings.

It can help you ensure that all your tax submissions are prepared ahead of time and compliant with HMRC’s digital rules. This will reduce the risk of errors and penalties.

Making Tax Digital (MTD) is designed to simplify tax management by moving tax records and submissions online. In the process, this will save you time by allowing them to automate VAT returns, Income Tax filings, and more. With MTD-compliant software like QuickBooks, you can access your records in real-time, collaborate with accountants or clients, and ensure you’re always up to date with the latest HMRC requirements.

MTD software is relevant if you are a VAT-registered business, a self-employed individual, or a landlord with income over the required thresholds. If you’re unsure whether MTD affects you, check your VAT registration status or income level.

Yes, you can connect QuickBooks accounting software to HMRC. We offer HMRC-recognised MTD-compliant software that allows you to submit MTD VAT returns directly to HMRC. This integration ensures that your records are digitally linked, in line with MTD requirements, making it easier for you to stay compliant with HMRC’s regulations.

Here are the latest key dates for MTD compliance.

April 2022:

Making Tax Digital for VAT applies for nearly all VAT-registered businesses

April 2026:

Making Tax Digital for Income Tax applies to self-employed businesses and landlords with annual business or property income above £50,000

April 2027:

Making Tax Digital for Income Tax applies to self-employed businesses and landlords with annual business or property income above £30,000

April 2028:

Making Tax Digital for Income Tax applies to self-employed businesses and landlords with annual business or property income above £20,000

Making Tax Digital (MTD) is compulsory for certain businesses and individuals. At the time of writing, HMRC has rolled out MTD for VAT requirements to all VAT-registered businesses. As of April 2026, MTD for IT will also apply to self-employed individuals and landlords with an income over £50,000. Businesses and individuals who fall under these thresholds are required to use MTD-compliant software to submit returns digitally for the specified tax.

Yes, QuickBooks is HMRC-recognised. This means our software helps businesses comply with Making Tax Digital (MTD) requirements for VAT, Income Tax, and other tax submissions. QuickBooks provides MTD-compliant software that allows businesses to keep digital records and file returns directly with HMRC.

You cannot opt out of Making Tax Digital (MTD) if it applies to your business. MTD is mandatory for businesses and individuals who meet the criteria, such as those registered for VAT or Self Assessment. The only exception may be for businesses that qualify for an exemption, such as those facing particular challenges (e.g., digital exclusion). You must apply to HMRC to use this exemption.

If you're not MTD-compliant, you will face penalties under HMRC's points-based system for late submissions and payments. You will receive penalty points for each missed deadline, and once you hit a certain threshold, you will be fined £200. Penalties apply separately for VAT and Income Tax, so you could face multiple fines if you miss deadlines for different submissions.

Additionally, if you don't pay on time, HMRC will impose late-payment penalties based on the number of days the payment is overdue, with percentages increasing the longer the delay. 

You may also appeal penalties, but you must have a reasonable excuse for failing to meet a filing obligation.

QuickBooks offers various pricing plans for our MTD software, depending on your business type:

For sole traders (managing Income Tax and preparing Self Assessment, VAT and non-VAT registered):

Prices from £10 per month (excluding VAT @20%).

For limited companies (managing VAT, suppliers, stock, and projects):

Prices from £16.60 per month (excluding VAT @20%).