Making Tax Digital (MTD) is changing how landlords and sole traders handle their tax returns — and while it may sound daunting, the goal is simple: to keep better digital records and file updates online.
At We Balance Bookkeeping in Milton Keynes, we’re here to make MTD easy to understand and stress-free to manage. Here’s everything you need to know — in plain English — about MTD for Income Tax Self Assessment, what it means for you, and how to get ready.
Who MTD for IT Applies To
From April 2026, sole traders and landlords with a combined income of £50,000 or more will need to follow the Making Tax Digital rules for Income Tax.
If your income is between £30,000 and £50,000, your start date is April 2027.
You’ll need to:
- Keep digital accounting records of your income and expenses.
- Send quarterly updates to HMRC using MTD-compatible software.
- Complete a final End of Period Statement (EOPS) each tax year.
If your income is below £30,000, you won’t be required to join MTD just yet — though it’s still a good idea to start getting organised digitally.
Exemptions from Making Tax Digital
You can apply for exemption if:
- You cannot use digital tools due to age, disability, or where you live.
- Your business is run entirely offline.
- You’re subject to insolvency procedures.
If you think you might qualify, we can help you check with HMRC before applying.
What Digital Records You’ll Need to Keep
Under MTD for IT, you’ll need to record your income and expenses digitally. For example:
- Landlords: Rent received, property repairs, insurance, and letting agent fees.
- Sole Traders: Sales, materials, travel, and other business costs.
Each transaction must be recorded using MTD-compatible software such as QuickBooks, FreeAgent, or another HMRC-recognised tool.
If you’re still using spreadsheets, bridging software can link them to HMRC temporarily — but full digital recordkeeping will soon be the standard.
Quarterly Updates and End of Period Statement
Instead of one yearly Self Assessment, you’ll send four quarterly updates for each income stream, showing your business income and expenses throughout the year.
At the end of the tax year, you’ll submit an End of Period Statement (EOPS) and a final declaration confirming your total income and tax due.
We handle this entire process for our Milton Keynes bookkeeping clients, ensuring every submission is accurate, on time, and stress-free.
Choosing the Right Software
At We Balance Bookkeeping, we help you pick the software that fits your needs:
- QuickBooks: Great for real-time bank feeds, receipts, and MTD submissions.
- FreeAgent: Popular with freelancers and small businesses.
We’ll help set everything up properly, provide training, and keep your books running smoothly so you’re fully MTD-ready.
How We Help You Stay Compliant
We make MTD easy by:
- Setting up your QuickBooks or chosen software for MTD compliance.
- Providing ongoing digital bookkeeping support.
- Preparing and submitting quarterly updates and EOPS on your behalf.
- Explaining your numbers in plain English — no jargon, no stress.
Whether you’re a Milton Keynes landlord, a local sole trader, or run a small business across the UK, we’ll guide you step by step through the process.
Milton Keynes Example
One of our local clients — a Stony Stratford-based hairdresser— moved from a paper-based system to QuickBooks with our help. Within weeks, they could track income and expenses digitally and were ready for MTD well before the deadline.
By making the switch early, they avoided last-minute stress and gained clearer visibility over their cash flow.
MTD for IT FAQs
1. Do I still need to file a Self Assessment tax return?
No — MTD for IT replaces Self Assessment with quarterly digital updates and a final declaration.
2. Can I use spreadsheets?
You can for now, but only with bridging software that connects to HMRC.
3. What if I have both business and rental income?
You’ll need to keep digital records for both and send separate quarterly updates.
4. When should I start preparing?
Ideally, now. The sooner you switch to digital, the easier your transition will be.
Book Your MTD Readiness Session
If you’re unsure where to start with Making Tax Digital, we can help you get fully set up and confident using digital bookkeeping tools.
📞 Book an MTD Readiness Session with We Balance Bookkeeping today — and make the switch to digital simple, compliant, and stress-free.
