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What is MTD (Making Tax Digital)

MTD is a key part of the government’s plans to make it easier for businesses to get their tax right and keep on top of their tax affairs. HMRC’s ambition is to be one of the most digitally-advanced tax administrations in the world, modernising the tax system to make it more effective, more efficient and easier for customers to comply.

Businesses need to keep digital records and use compatible software to send their VAT returns or Income Tax updates to HMRC, and receive information.

Keeping digital records and providing updates to HMRC directly through MTD-compatible software will help reduce errors, cost, uncertainty and worry. This streamlined digital experience will integrate tax into day-to-day business record-keeping, so that businesses can view their tax position in-year and be confident that they have got their taxes right.


What do businesses need to do to be ready to sign up for MTD?

You must start keeping your business records digitally before you can sign up for MTD. If you already use software to keep your business records, check with your software provider what their plans are. If you don’t use software just now, or your software won’t be MTD-compatible then you’ll need to consider what software, or bridging software, is most suitable for you.

Frequently Asked Questions

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