Making Tax Digital-compatible software is now a legal requirement for all VAT-registered businesses in the UK. Introduced to reduce errors and save time, the Making Tax Digital (MTD) initiative has been compulsory since 1st April 2022. It requires businesses to maintain digital records and submit VAT returns using approved software.
This means you must use an electronic record-keeping system that connects directly to HMRC and supports digital submissions. Whether you’re a sole trader, SME, or landlord, choosing the right software is essential for compliance and efficiency.
What Does Making Tax Digital Require?
Under the MTD for VAT regime, businesses must:
- Keep digital records of VAT transactions
- Use software that is compatible with HMRC’s systems
- Submit VAT returns digitally
Choosing the Right Software
When selecting your accounting software, consider:
- Ease of use and accessibility
- Real-time reporting and mobile access
- Integration with existing systems
- Multi-currency support
- Customer service availability
- Pricing and free trial options
Find a Suitable Provider
Making Tax Digital-compatible software
