Five Things to Review Under Making Tax Digital for Income Tax

After years of preparation and discussion, Making Tax Digital for Income Tax (MTD IT) is finally here for many small business owners and landlords across the UK.

From April 2026, self-employed individuals and landlords earning over £50,000 are now required to keep digital records and submit quarterly updates to HMRC using compatible software.

For some businesses, the transition has been smooth. For others, it’s been a learning curve. Either way, now is the perfect time to pause and review how things are working day-to-day.

In this blog, we’re sharing five key areas to check as you settle into MTD IT and adjust to the new way of reporting.

1. Is Your Software Actually Working for You?

Choosing MTD-compatible software was the first step, but now it’s important to ask whether it’s genuinely helping your business

Can you easily upload receipts, reconcile transactions, and run reports? Are you keeping records up to date regularly, or still relying on catching up at the last minute?

Software like Xero (find out more about our favourite Cloud Accounting Software here) can save huge amounts of time when used properly, but only if your systems and processes are working efficiently alongside it.

If you’re finding things clunky or confusing, now is the time to review your setup rather than struggling through quarterly deadlines.

2. Are Your Records Being Updated Regularly?

One of the biggest shifts under MTD IT is the move away from annual bookkeeping habits.

Quarterly reporting means waiting until year-end is no longer realistic. Keeping records updated monthly (or even weekly) makes submissions far less stressful and gives you a much clearer picture of your finances throughout the year.

Good habits now will make future quarters significantly easier.

3. Do You Understand Your New Deadlines?

Under Self Assessment, many business owners focused almost entirely on January. MTD introduces a much more regular reporting schedule.

That means multiple quarterly submission deadlines throughout the year, followed by a final end-of-year declaration.

Missing deadlines could still result in penalties, so understanding your reporting calendar is essential. Setting reminders and working closely with your accountant can help you stay ahead.

4. Are You Using the Data to Make Better Decisions?

One unexpected extra benefit of MTD IT is improved visibility.

Because records are updated more regularly, many businesses now have access to more accurate, real-time financial information. That can help with everything from cash flow planning to pricing decisions and budgeting.

Rather than viewing MTD IT as just another HMRC requirement, it can help to see it as an opportunity to become more financially informed throughout the year.

5. Have You Asked for Support Where You Need It?

You’re not expected to figure everything out alone.

Many small business owners are still adjusting to digital record-keeping, quarterly submissions, and new software systems. Asking questions early can prevent mistakes and reduce stress later.

At BCT Accountants, we’re helping clients with everything from software setup and training to ongoing bookkeeping and quarterly reporting support. Sometimes a few small adjustments can make MTD IT feel far more manageable.

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Making Tax Digital for Income Tax represents one of the biggest changes to the tax system in recent years. So naturally, there’s an adjustment to make.

If you’d like help with your business accounts and MTD IT, get in touch with Catherine on 01423 431 889 or email office@bctaccountants.co.uk to book your free consultation.

All information is correct for the 2026/27 tax year.