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Making Tax Digital
UK Tax Services
- Tax Return Preparation
- Tax Planning When Moving to the UK
- Tax Planning When Leaving the UK
- Tax Issues for Remote Workers and Digital Nomads
- Making Tax Ditial
- Corporate Tax for Relocating Business Owners
- Non-UK Domiciles
- Foreign Income & Gains Regime
- Property Income for Non-Resident Landlords
- Capital Gains Tax Returns When Selling UK Property
- Inheritance Tax Planning
- Worldwide Tax Disclosures
- Tax Investigation Cover
What Is Making Tax Digital?
Making Tax Digital (MTD) is a UK government initiative aimed at modernising the way taxes are reported and managed. The goal is to make tax administration efficient, accurate, and easier for taxpayers to get right.
Under MTD, qualifying individuals are required to:
- Keep digital records of their income and expenses.
- Use MTD-compliant software to manage and submit tax data.
- Submit updates to HM Revenue and Customs (HMRC) on a quarterly basis, moving away from the traditional annual tax return.
The shift aims to make tax administration:
- More accurate (fewer manual errors)
- More efficient (less paperwork)
- More transparent (real-time insight into your tax position)
Who needs to file?
- From April 2026, individuals with a gross income from self-employment and/or property exceeding £50,000 must comply with MTD for Income Tax. This threshold will reduce to £30,000 in April 2027 and £20,000 in April 2028.
- Instead of submitting a single annual tax return, you will file quarterly updates to HMRC, offering a more real-time view of your tax position.
- At the end of the tax year, a final declaration will be submitted, consolidating the quarterly updates and any adjustments.
Quarterly Updates
Under MTD, you will need to send financial summaries to HMRC every 3 months. These reports include:
- Total income
- Allowable business expenses
- Any other relevant adjustments
These are not tax bills, they give HMRC (and you) an up-to-date view of your tax position.
Final Declaration
At year-end, you will submit a Final Declaration, replacing the traditional Self-Assessment. This confirms all your figures, adjustments, and any additional income (like bank interest). This step is where tax is officially calculated and paid.
Benefits of MTD
Switching to MTD can bring tangible advantages, especially for small businesses and landlords.
- Efficiency: Streamlines the tax process, reducing the time spend on manual calculations and paperwork.
- Accuracy: Digital records help minimise errors, leading to more accurate tax submissions.
- Real-time insights: Provides a clearer picture of your financial standing, aiding in better financial planning.
Think of MTD not just as a legal requirement, but as a chance to modernise your finances and streamline your admin.
How we can assist:
Navigating MTD can seem daunting, but you’re not alone. Our team is here to support you with:
- Providing continuous support to ensure smooth quarterly submissions and compliance.
- Timely filing of Quarterly Updates and Final Declarations.
Is there an alternative option?
If you are self-employed and/or have multiple investment properties, it may be worth checking if you are better setting up a Limited Company and operating via a different structure, which is then outside of MTD. This will not benefit everyone; however, we can help you to assess whether this is right for you and assist with any setup and administration.
What should I do next?
For further information, please contact our dedicated MTD Team by email at mtd@gtn.uk or call our Client Service Team on 0207 100 2126 who would be happy to discuss how we can help.