Making Tax Digital Is Here.

We’ll Help Your Business Stay MTD-Compliant

Making Tax Digital (MTD) Support For VAT, Sole Traders & Landlords

Need help with Making Tax Digital? BSMART helps VAT-registered businesses, sole traders, landlords and accountancy practices set up MTD-compatible software, digital records and quarterly reporting processes.

MTD Is No Longer A Future Deadline.
It Is A Live Compliance Requirement.

Making Tax Digital is HMRC’s shift towards digital record keeping and software-led tax submissions. For VAT-registered businesses, MTD is already mandatory. For the first mandated group of sole traders and landlords, MTD for Income Tax has now begun.

Digital records are no longer optional for businesses within scope.

Compatible software is now part of compliance.

Quarterly updates are becoming the new reporting rhythm.

Delayed migration can create avoidable pressure before submission deadlines.

If You Fall Into One Of These Groups, MTD Matters Now.

Based on current HMRC guidance, MTD applies differently depending on whether you are a VAT-registered business, sole trader, landlord, partnership, or limited company.

VAT-Registered Businesses
MTD for VAT applies to all VAT-registered businesses. VAT records must be kept digitally and VAT returns must be filed using HMRC-compatible software.
Sole Traders And Landlords
MTD for Income Tax is being introduced in phases based on qualifying income from self-employment and property:

  • From 6 April 2026: qualifying income over £50,000
  • From 6 April 2027: qualifying income over £30,000
  • From 6 April 2028: qualifying income over £20,000

This means eligible taxpayers must keep digital records, use compatible software, send quarterly updates to HMRC, and submit their tax return through MTD software.

Partnerships
Partnerships are expected to come into MTD for Income Tax in the future, but HMRC has not yet confirmed the timeline.
Limited Companies
MTD does not currently apply to Corporation Tax in the same way it applies to VAT and Income Tax Self Assessment. However, limited companies should still focus on digital finance systems, VAT compliance, cleaner records, and stronger reporting processes.

What Changes Under MTD?

It’s Not Just About Using Software.

MTD changes how records are created, maintained, reviewed, and submitted. For businesses and individuals within scope, it means moving away from last-minute tax preparation and towards more regular, software-led financial reporting.

Under MTD, you may need to:

  • Keep records digitally
  • Use HMRC-compatible software
  • Send quarterly updates for Income Tax
  • Submit VAT returns through compatible software
  • Review income and expense categories more regularly
  • Reduce dependency on year-end cleanup and manual spreadsheets

For MTD for Income Tax, quarterly updates are summaries of income and expenses. They are not full tax returns, but they must still be submitted on time.

The First Income Tax MTD Deadline Is Closer Than It Feels.

For those in the first MTD for Income Tax group, the 2026/27 tax year has already begun. The first quarterly update deadline falls on 7 August 2026.

That means the real work starts before the deadline:

  • Choosing the right software
  • Setting up the correct records
  • Cleaning historical data
  • Mapping income and expense categories
  • Authorising software with HMRC
  • Ensuring the bookkeeping process is ready for regular updates

Waiting until the deadline creates unnecessary stress. Preparing early creates a smoother transition.

Non-Compliance Is One Risk.

Operational Disruption Is The Bigger One

Most businesses do not struggle because the rules are impossible to understand. They struggle because the practical shift gets delayed.

Common pressure points include:

  • Records still sitting in spreadsheets
  • Disconnected bookkeeping systems
  • Incomplete data cleanup before migration
  • No internal capacity to handle setup and coding
  • Confusion around software compatibility
  • Quarterly updates being treated like year-end filing
  • Compliance work being pushed to the last minute

Even where first-year quarterly update penalties are relaxed, the operational risk remains real: late setup, poor records, and rushed bookkeeping can delay submissions and create avoidable pressure before the tax return is finalised.

BSMART Makes MTD Practical And Easy To Adopt.

We help your business move from confusion to a working setup that supports compliance as well as day-to-day finance operations.

Our support includes:

  • MTD readiness assessment
  • VAT MTD compliance support
  • MTD for Income Tax preparation
  • Software selection and setup
  • Xero setup and migration support
  • Digital record-keeping workflows
  • Historical data cleanup
  • Transaction coding and bookkeeping support
  • Quarterly update preparation
  • Ongoing reporting and compliance support

With BSMART, MTD does not have to feel like another burden. We help you put the right system, records, and process in place.

Accountancy Practices: Clients Still Not MTD-Ready?

We Can Clear The Backlog Under Your Brand.

With MTD for Income Tax now live for the first group of sole traders and landlords, many accountancy practices have clients who still need support with setup, cleanup, migration, and regular bookkeeping.

The challenge is not just compliance. It is capacity. BSMART supports accountancy practices with white-label delivery, so you can serve your clients without stretching your internal team.

We support practices with:

  • Xero setup
  • Client migration support
  • Historical data cleanup
  • Ongoing transaction coding
  • Digital record-keeping setup
  • Quarterly update support
  • Back-office bookkeeping assistance
  • White-label delivery under your brand

Your clients stay supported. Your practice stays in control.

Be MTD-Ready Before It Becomes Urgent.

Whether you are a VAT-registered business, a sole trader, a landlord, or an accountancy practice supporting multiple clients, MTD is now part of the UK tax landscape.
BSMART helps you move from manual, delayed, and disconnected records to a cleaner digital setup that supports compliance, reporting, and better financial control.

FAQs

Sole traders and landlords with qualifying income above the relevant threshold need to use Making Tax Digital for Income Tax. The rules are being introduced in phases, starting with those above £50,000 from 6 April 2026.

MTD for Income Tax starts from 6 April 2026 for qualifying income over £50,000, from 6 April 2027 for income over £30,000, and from 6 April 2028 for income over £20,000.

Qualifying income generally includes total income from self-employment and property before expenses. HMRC uses this income to decide whether and when MTD for Income Tax applies to you.

Yes, landlords within the MTD threshold need compatible software to keep digital records and send updates to HMRC. This applies where property income, alone or combined with self-employment income, crosses the relevant threshold.

You should start before your first quarterly update is due, so there is enough time to clean records, set up software, authorise HMRC access, and test the process. Waiting until the deadline can create unnecessary pressure.

Spreadsheets may still be used only if they are connected to HMRC through compatible bridging software. Manual records or disconnected spreadsheets will not be enough for MTD compliance.

You may need to change or upgrade your software if your current system is not HMRC-compatible for MTD. BSMART can help assess your existing setup and recommend the right software or migration approach.

For the first mandated Income Tax group, the first quarterly update deadline is 7 August 2026. This covers the first update period beginning from 6 April 2026.

MTD currently applies to VAT obligations for VAT-registered limited companies, but it does not apply to Corporation Tax in the same way. Limited companies should still maintain strong digital finance systems for VAT compliance, cleaner reporting, and better control.

For the 2026/27 tax year, HMRC has said there will be no penalties for missing quarterly update deadlines. However, the updates still need to be submitted before you can finalise your tax return.

A quarterly update usually includes totals for income and expenses from your self-employment or property income. It is not a full tax return, but it still needs accurate digital records behind it.

Yes, BSMART supports accountancy practices with white-label MTD migration, Xero setup, data cleanup, transaction coding, bookkeeping support, and quarterly update preparation. Your clients stay supported while your practice retains control of the relationship.