Making Tax Digital for Income Tax

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Making Tax Digital for Income Tax: What You Need to Know

by Liburd Gallagher Accountancy

Making Tax Digital (MTD) is transforming how self-employed individuals and landlords manage their tax obligations. From April 2026, those earning over £50,000 annually must comply with MTD rules for Income Tax – ensuring a smooth digital process for tax reporting.

Close-up of a calculator and pen on a bar graph, representing Making Tax digital

What Is Making Tax Digital for Income Tax?

MTD is HMRC’s initiative to streamline tax management by digitising financial records and submissions. Rather than relying on manual reporting, individuals must keep digital income and expense records and submit quarterly updates to HMRC using MTD-compliant software.

How to Stay Compliant with MTD

To ensure a hassle-free transition, follow these key steps:

  • Confirm Your Registration: Check if you’re enrolled or speak to your accountant.
  • Keep Digital Records: Log income and expenses in an MTD-compatible format throughout the year.
  • Enable Accountant Access: Grant secure access via your Government Gateway account so they can submit updates efficiently.
  • Use MTD-Compatible Software: Ensure submissions are accurate and minimize manual errors with secure HMRC integration.

Even if your accountant handles the submissions, you’re responsible for keeping complete and accurate digital records of all your income and expenses.
Here’s what you need to do:

  • Record your income and costs
  • Keep these records up to date throughout the year (not just at year-end)
  • Send the digital records to your accountant in a format they can work with
  • Ensure all information is complete and sent in time for the required quarterly updates

Make Sure Your Accountant Can Access Your MTD Income Tax Account

To submit quarterly updates and your final declaration, your accountant will need access to your MTD Income Tax account.
If they haven’t done this yet, they’ll walk you through the steps to authorize their software via your Government Gateway account.
This only needs to be done once and ensures smooth communication between their software and HMRC.

What Does MTD-Compatible Software Actually Do?

When your accountant uses MTD-compliant software, it will:

  • Store your income and expense records digitally
  • Use those records to create accurate quarterly updates and a final declaration
  • Connect directly to HMRC through a secure digital link, reducing the risk of manual errors.

Why Choose Liburd Gallagher Accountancy?

At Liburd Gallagher Accountancy, we specialise in helping self-employed professionals and landlords navigate MTD compliance with ease. Our expert team ensures your records are structured correctly, submissions are error-free, and tax obligations are met on time.

📞 Contact us today to simplify your MTD transition and stay compliant without the stress!

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