MTD practice planning: What to do if you need last-minute help

Accountants and bookkeepers surely don’t need anybody to remind them that Making Tax Digital (MTD), HMRC’s digital transformation programme for the tax system, reaches a new milestone in April 2026 when it expands to cover Income Tax.

But what if your practice planning isn’t where you’d like it to be?

Or what if you just want to check to ensure you’re doing things right and haven’t missed anything out?

That’s what this blog is all about. Here’s what we discuss:

MTD: The next frontier for accountants

MTD for VAT was made mandatory in 2022 and, with lessons learned, it’s now being rolled out to Income Tax.

The first hurdle for many firms is client communications.

“Awareness has definitely grown since marketing campaigns from both the HMRC and software firms have increased,” says Ryan Anderson of accountants DJH Business Advisors. “But understanding remains surface-level for most affected taxpayers.

“The majority know that ‘something’s changing’ but few truly understand what MTD will mean for them day-to-day and that could build into a sizeable issue for companies in the UK.”

“There is also a need to balance MTD against existing workloads, given that the first submissions will coincide with the beginning of the 2025/26 tax return season—so resource planning and clear communication, both internally and to clients, are key.”

Even if, as an accountant or bookkeeper, you’re aware that this deadline is looming, your clients might not be. You may well have a lot on your plate with Self Assessment work both now and in January.

So, how do you ensure that you and your clients are ready for MTD for Income Tax?

The 4 basic steps to prepare for MTD for Income Tax

Essentially, according to HMRC there are four steps.

First, you need to work out a client’s qualifying income: above £50,000 for the first wave of MTD for Income Tax as of April 2026, then £30,000 as of April 2027, and £20,000 as of April 2028.

Then you need to find out if and when they need to use Making Tax Digital for Income Tax. Digital exclusion rules apply, and there are also some automatic exemptions.

If they do need to use MTD, then thirdly, you’ll have to create an agent services account (ASA) if you haven’t already, before finally buying in the right software.

Some clients might take a do-it-by-myself approach. Others might fall into the do-it-with-me category and will therefore require some help.

You might also have some do-it-for-me clients—those that simply do not or will not use software.

Surprisingly, you can still work with these clients in a post-April MTD landscape.

With this latter group you can use AccountsPrep, an AutoEntry add-on for accountants and bookkeepers that makes reconciliation for non-digital clients quick and easy.

You can use AutoEntry to scan and upload bank statements, or other files like receipts and bills, and then import them directly into AccountsPrep, to then create accounts literally in minutes, ready for import to final accounts software for MTD submission.

Those using AccountsPrep report it can turn days of work into hours. This level of automation and time saving is going to be vital considering quarterly update schedules for all your clients.

Choosing the right technology

As the digital part of the name suggests, MTD is essentially all about automation.

You’ll need to check that you’re using the best technology to speed up processes, ensure compliance, keep costs down and, very importantly, reduce the risk of errors.

Needless to say, artificial intelligence (AI) can help here.

Sage, for instance, has recently launched the UK’s first MTD for Income Tax Agent, tech that will transform quarterly updates into a single, end-to-end workflow for you.

More importantly, it acts like an additional member of staff keeping an eye out for problems and reminding you about deadlines and what you need to do next.

But you need to be ready to consider a range of technologies.

Manual processes are not just outdated. They’re now completely inappropriate.

It’s essential, though, to choose systems that integrate with each other to comply with digital linking rules, which are unchanged from MTD for VAT. It’s still difficult if not nearly impossible to use spreadsheets without breaking the copy and paste prohibition—which literally means you’re breaking the law.

And to move from paper to digital, you’ll need to think about what you want to achieve in your digital transformation and then find the best technology.

MTD compliance and integration should be one key outcome. You might also want to decide whether benefits such as speed and cost cutting are also important to you.

“MTD will require approved software,”says Jeremy Kitson, a director at Prime Accountants Group. “So we need to migrate clients onto software where they’re not currently using a software package.

“This comes at a cost in terms of subscription prices which are relatively inexpensive but also training time. Not everyone is used to using digital software, or may not be IT literate, so the technology may be daunting.

“There will be a requirement to make quarterly submissions as well as an end-of-year return, so there is an additional administrative burden. However, this can give more up-to-date business information and is an opportunity for business planning.”

Once you’ve chosen the most appropriate combination of technology you can start identifying repetitive manual tasks that can be automated before scanning and storing paperwork in the cloud.

You might want to start with one client and use this as a test run—it’s a good way of making sure that your technology integrates with your client’s systems.

It will also allow your clients to get into the habit of using digital technology and digitising their systems. Ensuring that both clients and your own teams understand why and how you’re digitising systems and records is essential.

Anderson says he’s communicating the following to clients about tech systems: “Try the mobile app first. By having access to your records via your phone, you can easily make your bookkeeping part of your lifestyle. Snap a receipt, or send an invoice in seconds, rather than tackling a mountain of paperwork each quarter.”

Managing clients and negotiating fees

Another important issue that you’ll have to discuss with clients is your fee.

Given that the work you’ll be doing for your clients will be changing you might want to suggest that you switch from fees to a retainer.

Technology can help here. Sage’s GoPropoal allows you to create a proposal and letter of engagement for a client with fees that are not only transparent but that work for you and for them. It also allows you to standardise pricing, which can really impact your bottom line.

Does this change mean that you’ll have to drop clients who might struggle with MTD or might not find it directly relevant?

The answer here is no, as this isn’t like MTD for VAT. You can still retain your do-it-for-me” clients. Again, AccountsPrep is a unique and vital solution for this.

On a practical level, they just need to sign their digital tax return, which can be done just as you do it now—perhaps digitally signing in response to an email request you send.

You can still support them in other ways, including quarterly updates and reconciliations even on a daily, weekly or monthly basis. However, the increased work here will obviously impact the fees you charge. You certainly can’t continue to apply the same pricing as for the once-yearly Self Assessment work.

James Mitchell, Head of NCA at Sage business partner Acuity24 recommends a phased approach to managing clients: “Start by segmenting clients according to their readiness: who already uses compatible software, who relies on spreadsheets, and who still works manually.

“For clients still using manual systems, focus on adopting digital-first processes and compatible tools that make MTD compliance simpler. Offer guidance or check-ins to help clients feel confident using these processes; adoption is as much about reassurance as it is about technology.”

The need to take action now

“For accountants themselves, now is also the time to look inward,” continues Mitchell.

“Teams that still rely on manual reconciliations or disconnected systems will struggle to keep up once MTD filing becomes more frequent and detailed. Embracing automation in reporting and record keeping can free up a lot of time to focus on advisory work rather than admin.”

More generally, you might want to think of implementing these changes one month at a time.

In month one, for instance, you’ll want to identify which of your clients falls within the scope of MTD for Income Tax.

By month two you should have thought about choosing the right software platform as well as worked out how you’re going to migrate existing data. This is also a good time to set a budget and start staff training as well as raising awareness of the far-reaching impact of the changes.

“While awareness of MTD has improved in recent times, many business leaders continue to underestimate how much work is involved in truly preparing for it,” explains Vipul Sheth, MD of accountancy outsourcing experts AdvanceTrack.

“Many accountants assume their clients are ‘digital’ because they’re using cloud software. However, that obviously doesn’t mean they’re MTD-compliant. Preparedness is patchy, especially among smaller businesses and landlords.”

The biggest challenge is shifting behaviour, according to Sheth.

“For many clients, MTD for Income Tax means a completely different way of working—moving from annual touchpoints to quarterly updates and being responsible for digital record-keeping.

“For many, this represents a major culture change, and one that accountants will need to guide them through.”

Month three in your action plan should be about starting migration. This involves setting up digital record-keeping, testing transactions and linking client data and submissions.

Finally, in month four you might want to run a test submission, just to check that everything works.

Final thoughts

Accountants need to create a clear timetable of actions. It’s not yet too late to implement a sound MTD practice transformation.

As well as a challenge, you can see MTD as an opportunity to digitise your firm, upskill your teams and even review your whole business strategy.

“The overarching message is simple: don’t treat MTD as a deadline,” says Mitchell. “Treat it as an opportunity. The firms that help clients make the digital leap now will reduce risk later and position themselves as trusted advisors who add real value beyond compliance.”