This Christmas marks 100 days to Making Tax Digital (MTD)

Use the holiday season to get ahead with MTD. 

On Boxing Day it will be 100 days until MTD for IT starts. While some may feel apprehensive about the upcoming changes, now is the time to understand and embrace your new reporting responsibilities. Taking proactive steps today can not only ensure compliance but also streamline your processes and ultimately make record keeping easier in the long term.

What is changing?

MTD for IT is just around the corner, and it’s going to change the way you manage your tax. From April 2026, individuals with property and/ or sole trade gross income of greater than £50,000, will be required to:

• Keep digital records  
• Send a quarterly summary of their business income and expenses to HMRC using MTD-compatible software. 

This is based on the information submitted within your 2024/25 tax return. 

From April 2027, the same requirements will apply to anyone with income over £30,000.

Why Christmas is a great time to prepare  

The Christmas break is the perfect time to check if you fall into MTD, set up a compatible software and update your records, to make sure you’re ready for the changes ahead.

By using this time wisely, you’ll start the new year with confidence and avoid the pressure that comes with last-minute compliance.

Make technology work for you

You don’t have to do it all manually. A simple software subscription takes the hassle out of quarterly updates and digital record keeping. It’s not just about reporting your income, you can also see and report your expenses and tax position in real time. These tools are designed for sole traders, landlords, and small businesses, and so they are easy to use and HMRC-approved.

Think of it as giving yourself the gift of peace of mind.

Once you have completed and finalised your 2024-25 Tax return, you will be able to check if you are required to be MTD compliant. 

Here are the top 5 things you can do to prepare if you fall into MTD for IT: 

• Start using MTD-compatible software early to get used to the system. If you’re not sure which option is best, get in touch with us today. We’ll help you choose the right software and make sure you’re ready for MTD ITSA. 
• Ensure you have separate bank accounts for each trade. For example, one account for property, and a separate account for each other business. Some banks currently offer business bank account options free of charge. These can then be used to set up bank feeds within your chosen software, to save you time and reduce input error. 
• Set up a government gateway account – follow this link for more guidance
• Organise your records digitally. Start moving away from paper and manual spreadsheets. Various MTD software offer options to capture your receipts and expenses on the go, including  mobile apps.
• Set up a meeting with your accountant. Discuss how MTD ITSA will affect you. Agree on who will handle quarterly submissions, and how much involvement or support you will require. 

Treat yourself to a practical present that saves time, reduces worry, and keeps you compliant, you deserve it! Get in touch with one of our experts today.