MTD software selection: Your complete guide to choosing the right partner for digital tax compliance
- HMRC mandates MTD-compatible software for quarterly and annual submissions by April 2026.
- Thomson Reuters offers complete MTD functionality with internal calculation engines and agent flexibility.
- Ten critical questions help practices evaluate MTD software providers for compliance.
Following HMRC’s Spring Statement 2025 announcement that MTD mandated taxpayers must use Making Tax Digital for Income Tax compatible software for both quarterly and end-of-year submissions, accounting professionals face a critical decision: which software provider can truly support their practice through this digital transformation and beyond?
The stakes have never been higher. As HMRC’s MTD Testing and Software Lead Chris Jennings emphasised in our recent podcast, “This is the biggest change to that part of the tax for absolute years.” With April 2026 fast approaching and approximately 800,000 businesses entering the first mandation wave, choosing the right MTD software partner isn’t just about compliance—it’s about future-proofing your practice.
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Ten critical software selection questions every practice must ask
Leading from the front: Thomson Reuters’ HMRC pilot engagement
MTD software evaluation framework
Conclusion: Choose your partner wisely
Ten critical software selection questions every practice must ask
1. Complete compliance: Does your software handle both MTD updates and end of year submissions?
The question: Can your software provider handle both quarterly updates AND end-of-year submissions natively?
Not every Making Tax Digital solution offers complete functionality. While some providers focus solely on quarterly submissions, leaving you to manage end-of-year processes separately, others are still working on a solution for MTD year-end return. Tax professionals need comprehensive solutions that handle the entire MTD workflow seamlessly.
Thomson Reuters’ Digita MTD for Income Tax software includes both quarterly and annual submission capabilities built into a single, integrated platform, eliminating the need for multiple software solutions and reducing data inconsistency risks.
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2. HMRC roadmap: Is your provider looking ahead?
The question: Is your MTD for Income Tax software HMRC-recognised? Does your software provider demonstrate insight into HMRC’s digital transformation roadmap?
HMRC’s digital journey extends far beyond basic MTD compliance. The most forward-thinking providers actively engage with HMRC throughout development processes. Thomson Reuters works closely with HMRC, participating in testing phases, contributing to system refinements, and delivering a HMRC-recognised MTD for Income Tax solution. As HMRC’s Chris Jennings noted: “Having those really good relationships with the likes of Thomson Reuters… how quickly those markets have reacted has been absolutely outstanding.”
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3. Technical foundation: Internal tax calculation engines
The question: Does the software include robust internal tax calculation engines?
The complexity of UK tax calculations—from basis period reforms to the newly introduced FIG regime—requires sophisticated computational capabilities. Software solutions that do not have their own calculation engine, but rely solely on HMRC’s tax calculation introduce delays, errors, and compliance risks.
Thomson Reuters Digita’s internal tax calculation engines provide real-time computational accuracy with automatic updates for regulatory changes, ensuring calculations remain current and compliant without manual intervention.
4. Agent flexibility: Supporting modern practice structures
The question: Can the software accommodate both main and supporting agents?
As HMRC’s Chris Jennings explained: “We’ve introduced the functionality which we call enabling multiple agents… So effectively you have a main agent, which is usually the accountant and then you can have supporting agents, which is usually the bookkeepers.”
Thomson Reuters’ MTD solution fully supports both main and supporting agents, empowering your practice with the flexibility to offer more structured and customised services for your clients.
5. Digital linking and flexibility: Can your software meet you where you are?
The question: Does your software provider accommodate your existing workflows?
The reality of MTD implementation is that practices operate with diverse data collection methods—from sophisticated bookkeeping software to client-maintained spreadsheets. The most effective MTD solutions recognise this diversity and provide flexible import capabilities rather than forcing practices to abandon established workflows.
Thomson Reuters’ Digita MTD for Income Tax software supports comprehensive data import functionality, including spreadsheet imports, allowing practices to work with clients’ existing data formats while ensuring MTD compliance. This flexibility means you can serve clients regardless of their current data management sophistication level.
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6. Third-party oversight: Can you track external submissions for complete client management?
The Question: Does your software provide visibility into quarterly submissions made through third-party applications, for comprehensive client oversight?
In today’s diverse software landscape, clients may use different applications for various aspects of their tax compliance. Some may submit quarterly updates through alternative MTD software while relying on you for annual submissions and strategic advice. Without visibility into these external submissions, practices lose crucial oversight of their clients’ compliance status and timing.
The most sophisticated Making Tax Digital for Income Tax solutions recognise this reality and provide tracking capabilities for submissions made outside their platform. This oversight functionality allows accountants to maintain complete visibility into client compliance activities without requiring intrusive data requests or manual tracking systems.
Thomson Reuters’ Digita MTD for Income Tax software includes oversight functionality that allows practices to track quarterly updates made through third-party software, ensuring you maintain complete visibility of your clients’ MTD compliance journey, regardless of which tools they use for different submissions.
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7. Comprehensive reporting: Beyond basic compliance
The question: Does your MTD software provide comprehensive reporting and insights beyond basic compliance submissions?
MTD compliance is just the beginning. The most valuable solutions transform quarterly updates and annual returns into actionable business intelligence. HMRC’s Chris Jennings noted: “Businesses doing this are able to keep on top of their business in a much better way because you start to get all of the analytics that you wouldn’t get before.”
Thomson Reuters Digita MTD for Income Tax reporting capabilities:
- Computation summary excellence: Detailed computation summaries for both quarterly updates and annual returns.
- Client-ready reports: Professional reports that transform complex tax data into clear, actionable insights.
- Audit trail documentation: Comprehensive audit trails linking quarterly submissions to final declarations.
8. Integration capabilities: Avoiding data silos
The Question: How does the software integrate with your existing practice management systems?
Standalone MTD solutions create data silos that increase workload and error risk. Thomson Reuters Digita integrated suite architecture ensures MTD data flows seamlessly across all client touchpoints, eliminating duplicate data entry and maintaining consistency throughout practice operations.
9. Cybersecurity standards: Non-negotiable protection
The Question: What cybersecurity measures protect client data?
With sensitive client financial data at stake, cybersecurity cannot be an afterthought in MTD software selection. The digital transformation of tax compliance creates new attack vectors and data vulnerabilities that require enterprise-grade protection measures.
Thomson Reuters implements enterprise-grade cybersecurity measures, including ongoing security evaluations, robust access controls, and comprehensive disaster recovery plans.
10. Support and Training: Implementation success
The Question: What level of support and training does the provider offer?
MTD experiences vary dramatically based on preparation and support. As mentioned in our recent podcast, some testers reported to Chris Jennings at HMRC that “This is brilliant. I really love it,” while others found it “a bigger deal than I thought it was going to be.” The difference may lie in vendor support quality.
Thomson Reuters customers benefit from a comprehensive support package to guide them through the digital transformation journey, from dedicated helplines connecting you to MTD expert support to online training and interactive webinars. Our Professional Services team have decades of experience with complex migration needs and are dedicated to supporting your transition to Thomson Reuters.
Leading from the front: Thomson Reuters’ HMRC pilot engagement
Thomson Reuters has been at the forefront of MTD development as the first software company to sign up to the first HMRC pilot programme. Our commitment to early adoption and continuous collaboration has delivered tangible results:
- First-mover advantage: Early pilot participation ensuring comprehensive system testing
- Hundreds of successful quarterly submissions: Real-world validation through our software platform
- HMRC-recognition: Direct acknowledgment as a software that works for MTD for Income Tax
Jen Staves, Deputy Director, Strategic Design, Making Tax Digital at HMRC acknowledged the collaborative working relationship at a recent webinar saying “I have a brilliant relationship with the Thomson Reuters team as well as many others who are our partners in delivering this our digital delivery”, further commenting on the MTD Pilot engagement: “Thomson Reuters has already got lots of people to sign up early, which has been absolutely brilliant; helps us test the service, helps Thomson Reuters test the service, helps you test the service and be ready.”
MTD software evaluation framework
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The Thomson Reuters advantage
When applying this framework, Thomson Reuters consistently demonstrates leadership across all evaluation criteria:
- Technical excellence: Complete MTD functionality with internal calculation engines, multiple agent support, and comprehensive reporting capabilities including detailed computation summaries.
- Strategic partnership: First software company to join HMRC’s original pilot programme, with hundreds of successful quarterly submissions and HMRC-recognition.
- Security leadership: Enterprise-grade cybersecurity measures.
- Practice integration: Seamless integration within our comprehensive practice management suite.
- Professional support: Dedicated implementation specialists and comprehensive training programmes designed for accounting professionals.
Conclusion: Choose your partner wisely
The Making Tax Digital for Income Tax mandate represents more than a compliance requirement—it’s the foundation of HMRC’s digital tax future. Your software provider choice will impact your practice’s efficiency, client service capability, and competitive position for years to come.
Don’t settle for basic compliance solutions. Choose a partner who understands the professional accounting landscape and provides the technical capabilities your practice needs to thrive in the digital era.
With April 2026 approaching rapidly, the time for evaluation is now. Choose Thomson Reuters Digita MTD for Income Tax—the complete solution for the digital tax future.
Ready to explore how Thomson Reuters can support your MTD transition? Contact our UK tax specialists today for a comprehensive consultation and demonstration.
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