Making Tax Digital — get ahead of it before HMRC comes looking
Making Tax Digital is the most significant change to UK tax administration in a generation. It is already law for VAT. It is coming for income tax in April 2026. And it will eventually reach corporation tax. Businesses that prepare now — with the right software, the right processes, and the right adviser — will find the transition straightforward. Those that leave it until the deadline arrives will not. Hulljady Chartered Accountants gets UK businesses MTD-ready before the pressure is on.
WHAT WE DO
Making Tax Digital services for UK businesses and individuals
From assessing whether MTD applies to you, to setting up compliant software, to managing your quarterly submissions on your behalf — Hulljady provides end-to-end MTD support for every type of taxpayer.
MTD Eligibility & Obligation Assessment
A clear, personalised assessment of which MTD regimes apply to you, when they apply, and what specifically you need to do to comply — taking account of your business structure, turnover, income sources, and current record-keeping arrangements.
MTD for VAT — Setup & Compliance
For businesses not yet fully MTD compliant for VAT — including those still using spreadsheets with manual bridging — we configure fully compliant software, connect bank feeds, and take over the management of quarterly VAT submissions via the MTD platform.
MTD for Income Tax Self Assessment — Preparation
For sole traders and landlords approaching the April 2026 and April 2027 thresholds, we assess your current position, recommend and configure the right software, establish your quarterly update workflow, and ensure you are fully prepared before the mandatory start date — not scrambling to comply after it.
Digital Record-Keeping Setup
Configuration of HMRC-recognised software — Xero, QuickBooks, Sage, or FreeAgent — with the chart of accounts, income categories, and expense classifications required to produce compliant quarterly updates and accurate end-of-period statements automatically from your live records.
Quarterly Update Management
Preparation and submission of your quarterly updates to HMRC on your behalf — reviewing your digital records each quarter, making any necessary adjustments, and filing the update within the required window. You focus on running your business. We handle the filing.
End-of-Period Statement & Final Declaration
At the end of each tax year, MTD for Income Tax requires an end-of-period statement for each income source and a final declaration — the equivalent of the current Self Assessment return — confirming the accuracy of the full year position. We prepare and submit both, incorporating any year-end adjustments and reliefs not captured in the quarterly updates.
KEY FIGURES
The MTD timetable — what is already in force and what is coming
MTD has been rolling out in stages since 2019. Understanding where each stage sits on the timetable is the starting point for knowing what you need to do and when.
April 2019 — MTD for VAT above £85,000 VAT-registered businesses above the then-threshold of £85,000 have been required to keep digital VAT records and file via MTD-compatible software since April 2019. Already in force for six years — with HMRC actively penalising non-compliance.
April 2022 — MTD for VAT all businesses Extended to all VAT-registered businesses regardless of turnover — including those voluntarily registered below the current £90,000 threshold. Every VAT-registered business in the UK must now use MTD-compatible software and submit via the MTD platform. No exceptions.
April 2026 — MTD for Income Tax above £50,000 Sole traders and landlords with combined gross income from self-employment and property above £50,000 must keep digital records and submit quarterly updates to HMRC. This is the most significant MTD expansion yet — affecting hundreds of thousands of individuals currently filing a single annual Self Assessment return.
April 2027 — MTD for Income Tax above £30,000 The income threshold drops to £30,000 — substantially widening the population required to comply. Businesses and landlords in this band have less than two years to prepare from today.
Note: HMRC has confirmed that MTD for Corporation Tax is under development and will be consulted on in due course. The direction of travel is clear — all business tax reporting will eventually be digital and quarterly. Businesses that have already made the transition to cloud accounting and digital record-keeping will be well positioned for every future phase of MTD. Those that have not will face increasingly frequent disruption as each new deadline arrives.
HOW WE WORK
MTD packages built around where you are starting from
The right MTD support depends on whether you are already partially compliant, starting from scratch, or facing an imminent deadline. Hulljady tailors its MTD service to your starting position — getting you to full compliance efficiently, without unnecessary disruption.
MTD VAT Compliance Review
For VAT-registered businesses already using MTD-compatible software but uncertain whether their processes are fully compliant — we review your digital links, your record-keeping, and your submission process, and identify and resolve any gaps before HMRC does.Pay a fixed percentage of your gross turnover as VAT rather than calculating VAT on every transaction. Ideal for service businesses with limited VAT-able costs — many businesses profit from the difference.
MTD VAT Full Setup
For businesses not yet compliant with MTD for VAT — we configure compliant software, establish digital links throughout the record-keeping chain, connect bank feeds, and take over submission of quarterly VAT returns via the MTD platform. Includes training for you and any relevant team members.
MTD ITSA Readiness Assessment
A comprehensive assessment of your MTD for Income Tax obligations — confirming whether and when you are in scope, reviewing your current record-keeping arrangements, identifying the gaps, and producing a clear action plan with recommended software and timeline for full compliance.
MTD ITSA Full Preparation
End-to-end preparation for MTD for Income Tax — software selection and configuration, digital record-keeping setup for all income sources, quarterly update workflow established and tested, and a full dry run of the quarterly submission process before your mandatory start date. The most complete preparation package available.
Ongoing Quarterly Management
A fully managed MTD service — we maintain your digital records, prepare and submit your quarterly updates, produce your end-of-period statements, and file your final declaration. The MTD obligation is met in full every quarter without you needing to think about it.
Landlord MTD Package
Specialist MTD preparation for residential and commercial landlords — covering property income categorisation, allowable expense classification, mortgage interest treatment, and the correct handling of furnished holiday lettings, multiple properties, and jointly-owned properties under the MTD framework.
WHY HULLJADY
MTD compliance that builds a better business — not just a ticked box
There are two ways to approach Making Tax Digital. The first is to do the minimum necessary to avoid HMRC penalties — get some software, submit the returns, and treat it as an administrative burden to be minimised. The second is to use the digital infrastructure MTD requires as the foundation for genuinely better financial management — real-time visibility, regular reporting, and a closer relationship between your financial records and the decisions you make every day.
Hulljady takes the second approach. Every MTD engagement we undertake is configured not just to meet the minimum compliance requirement but to produce the most useful financial information possible from the same underlying data. The quarterly updates required by HMRC and the management accounts you need to run your business come from exactly the same source — and with proper configuration, they cost no more to produce together than apart.
- MTD setup configured for compliance and for useful management reporting simultaneously
- Certified on all major MTD-recognised platforms — Xero, QuickBooks, Sage, FreeAgent
- Quarterly updates submitted on time without exception — no penalty points accumulated
- End-of-period statements and final declarations prepared and filed as part of ongoing service
- Proactive monitoring of MTD legislative developments — you are informed before deadlines change
- One team manages MTD, bookkeeping, VAT, and year-end accounts — no duplication
COMMON QUESTIONS
Making Tax Digital— frequently asked questions
What is Making Tax Digital and why is HMRC introducing it?
Making Tax Digital is HMRC's programme to modernise the UK tax system by requiring businesses and individuals to keep digital records and submit tax information to HMRC using compatible software. HMRC's stated aims are to reduce the tax gap — the difference between the tax owed and the tax collected — by reducing errors that arise from manual record-keeping and annual reporting, and to make it easier for taxpayers to get their tax right in real time rather than correcting errors retrospectively. The practical consequence is a shift from annual tax reporting to quarterly digital submissions for an increasing proportion of taxpayers.
I am already filing my VAT return online — does that mean I am MTD compliant?
Not necessarily. Filing your VAT return through HMRC's online portal is not the same as MTD compliance. MTD for VAT requires not just digital submission but digital record-keeping throughout the entire record-keeping chain — from the point of recording a transaction to the point of submission — with no manual transfer of data between steps. If you are still entering figures manually into HMRC's portal, or using a spreadsheet that you then manually key into software for submission, you are not fully MTD compliant and are potentially exposed to penalties. Hulljady carries out MTD compliance reviews for businesses in exactly this position.
What counts as MTD-compatible software?
HMRC maintains a list of software products that have been recognised as MTD-compatible — meaning they can communicate directly with HMRC's systems via an Application Programming Interface (API). The major cloud accounting platforms — Xero, QuickBooks Online, Sage Business Cloud, and FreeAgent — are all on this list, as are a number of bridging software tools that allow businesses to use spreadsheets as their primary record while submitting digitally via the bridging tool. Hulljady recommends full cloud accounting platforms rather than bridging solutions — they provide better compliance, better management information, and a better foundation for future MTD phases.
How will MTD for Income Tax work in practice?
Under MTD for Income Tax Self Assessment, sole traders and landlords in scope will be required to maintain digital records of their income and expenses throughout the year and submit a quarterly update to HMRC within one month of the end of each quarter — broadly by 7 August, 7 November, 7 February, and 7 May. At the end of the tax year, they will submit an end-of-period statement for each source of income and a final declaration confirming the accuracy of their full year position. The quarterly updates are summaries — not full tax returns — but they must be submitted on time or penalty points will accumulate.
What happens if I miss an MTD quarterly submission deadline?
Under HMRC's new penalty points system, each missed quarterly submission earns one penalty point. Once the points threshold is reached — two points for quarterly filers — a financial penalty of £200 is charged, with a further £200 for every subsequent missed submission. Points can be reset to zero by submitting all outstanding returns and maintaining a period of good compliance. The important feature of this system is that it is cumulative — missing submissions consistently, even for relatively small amounts of tax, generates penalties regardless of the underlying tax position. Hulljady manages quarterly submissions for all clients on our ongoing MTD service, eliminating the risk of penalty points entirely.
Do I need a separate software package for MTD or can I use what I already have?
This depends on what you currently use. If you are already on a major cloud accounting platform — Xero, QuickBooks, Sage Business Cloud — the MTD functionality is built in and can be activated without changing your software. If you are using desktop accounting software, a spreadsheet, or paper records, you will need to move to an MTD-compatible solution. Hulljady assesses your current software as part of every MTD readiness review and recommends the most appropriate solution — whether that is activating existing MTD functionality, migrating to a new platform, or implementing a bridging solution where a full migration is not immediately practical.
READY TO GET STARTED?
MTD deadlines do not move. The best time to prepare is now.
Book a free, no-obligation consultation with one of our chartered accountants. We will confirm exactly which MTD obligations apply to you, assess your current compliance position, and put a clear action plan in place — so when HMRC’s deadline arrives, you are already ready.