Making Tax Digital Hub

As per current guidance, Making Tax Digital (MTD) for Income Tax will not change how tax payments are collected. A taxpayer’s income liability for MTD will continue to be assessed after the end of the tax year, as in the existing self-assessment process.

During the voluntary testing phase of Making Tax Digital for Income Tax, there are no penalties for late quarterly updates.

Once MTD for IT becomes mandatory for a customer from April 2026, a penalty point will be applied for each missed submission deadline. However, a financial penalty will only be imposed after four penalty points have been accumulated.

While agents can adjust client payment on account figures within the Thomson Reuters MTD software, these adjustments are not submitted to HM Revenue & Customs (HMRC). They are solely for internal use to reflect the client’s tax calculations accurately. Agents are currently required to make these adjustments directly within their client’s HMRC online services account.

Yes, agent authorisation is mandatory for submitting and retrieving information from HMRC. If you are a secondary or supporting agent, you will have limited access to what you can access within the MTD solution.

An ARN is a reference number generated when an agent creates an agent services account. HM Revenue & Customs has confirmed to us that an agent can only have one ASA account and one ARN associated with it. All other government gateway IDs can be linked to the ASA for various tax services provided.

Yes, agents can generate an agent authorisation link from Digita Personal Tax MTD module directly, which they can share with their clients to access and approve. Once approved, the software is updated to reflect the approval.

Qualifying income refers to the total income — gross income before any expenses are deducted — your client earns in a tax year from their sole trade business or property income, including income from foreign property.

Income from a partnership does not count towards your qualifying income unless you receive disguised investment management fees or income-based carried interest.

If you are a carer eligible for qualifying care relief, the qualifying care receipts you receive will not count towards your qualifying income.

As per HMRC guidance, these forms of remuneration are treated as the profits of a deemed trade and will form part of your qualifying income.

As per HMRC guidance, in the case of a bare trust, any property or trading income your client, as a beneficiary, is entitled to will count towards their qualifying income. In the case of an interest in possession trust, any property or trading income paid directly to your client — and bypassing the trustees — will count towards their qualifying income.

Currently, MTD for Income Tax is not applicable to partnerships. HMRC believes there are benefits to partnerships in adopting digital recordkeeping and the use of software. HMRC’s current priority is the successful delivery of MTD for income tax for sole traders and landowners. We want to ensure that any future timeline for the introduction of MTD for Income Tax to partnerships provides appropriate time and support for customers to make the transition.

To add a new source of income for quarterly submissions, you can add this to your client’s HMRC online services account within the “manage your client’s income tax” details section. Once the details are added, you need to re-import from HMRC in our MTD tax software to reflect the most up-to-date information available with HMRC.

As an agent you can update this information on behalf of your client in the HMRC online services account by reporting the date the business or property income source stopped.

After you’ve notified HMRC that a source of income has been ceased, there is no requirement to send quarterly updates for the quarters after the cessation date.

It might be impractical for your clients to maintain digital records or submit data to HMRC digitally due to age, disability, religion, location — like poor internet connection — or other valid reasons. If that’s the case, they can directly request an exemption from Making Tax Digital for Income Tax from HMRC.

From the 2025/26 tax year onwards, HMRC will introduce the Cumulative Quarterly Update Process. This process means you do not need to amend previous quarterly submissions if a transaction was missed or an error was made. Instead, you can correct the error in the next quarterly submission and import cumulative quarterly data directly into our MTD solution. No changes are required for earlier quarterly submissions.

Once the final declaration is submitted to HMRC for MTD, agents can amend it within the amendment window by contacting HMRC’s dedicated customer support team. Currently, amendments to final declarations cannot be made directly through MTD software as HMRC has not yet provided the necessary APIs for this function.

The Thomson Reuters MTD software provides a convenient way to track all submissions made for your client. The Submission History tab offers a complete record of all submissions to HMRC, including details such as the submission date, the submitter, and the status — whether successful or failed. In case of a failed submission, the reason for the failure is clearly displayed, allowing for quick identification and resolution of any issues.

The Thomson Reuters MTD solution will include an Import from HMRC feature starting with the 2026 to 2027 tax year. This feature allows you to directly import the most recent information submitted to HMRC for a specific cumulative quarter into your MTD tax solution.

Calendar election can be opted for during the first quarterly submission during the tax year. Once opted, it cannot be changed in the subsequent quarters.

No. Under MTD for Income Tax, traditional paper forms like SA100, SA103, and SA105 are no longer used. The process has transitioned to digital submissions through MTD-compliant software — like the Thomson Reuters MTD solution — via the Making Tax Digital APIs offered by HMRC.

The Thomson Reuters MTD solution offers three key report sections:

• Quarterly submissions – provides detailed reports for each quarter’s sole trade and property business, which are ready for submission to HMRC at the quarterly stage
• Income and outgoings – includes annual reports that summarise income, expenses, and adjustments, along with other sources of income such as dividends and interest, to provide a comprehensive overview of a client’s tax reporting
• Tax calculation – shows the tax computation reports and supporting documents used to calculate the client’s tax liability, including income tax, NICs, and any applicable deductions or reliefs

To verify HMRC’s calculation at the time of final declaration, the Thomson Reuters MTD solution provides an option to trigger and retrieve HMRC’s calculation. Once you retrieve the calculation from HMRC, you can easily compare it with the computation generated by our software to ensure that the figures align correctly before making the final declaration. This step helps confirm that the tax liability is accurate and consistent with HMRC’s records.

If you believe HMRC’s calculation is incorrect, you can contact HMRC’s dedicated customer support team for assistance.

Note: their contact details will be provided when HMRC confirms your sign-up for Making Tax Digital.

No IR mark is provided on the final computation reports in MTD for Income Tax. Instead, HMRC’s API generates a calculation ID to identify and track the submitted calculation. This ID ensures the computation is accurately linked to your submission in HMRC’s records. You will be able to view the associated calculation ID on the retrieved computation report.

Yes, after a quarterly submission, you can view your client’s estimated tax calculation in two ways: through the software-generated calculation offered by our MTD solution or by retrieving HMRC’s in-year tax calculation. The software-generated calculation estimates the tax liability based on the data reported in the data entry screens, while the HMRC calculation reflects the figures submitted to HMRC.

Unfortunately, HMRC has not yet made this functionality available for software providers to allow agents to directly sign up their clients to Making Tax Digital through the software.

However, agents can sign up their clients using the following link to the HMRC website: Signing up for Making Tax Digital for Income Tax

Yes, your client can opt out of Making Tax Digital for Income Tax during the testing phase if they signed up voluntarily. If they opt out, they will stop submitting quarterly updates, and any data submitted for that tax year will be deleted. However, they will still need to file a self-assessment tax return.

To opt out, your client can use their HMRC online services account under the Managing your Income Tax updates section. As an agent, you can do this once you’re authorised and can access your client’s online service.

If your client wants to sign up but has income from a source that is not part of HMRC’s eligibility criteria — like income from a trust, jointly owned property, or a furnished holiday let — they cannot sign up for the 2025/26 testing phase. HMRC’s system has specific eligibility rules, and if your client’s income comes from excluded sources, they won’t be able to join.

If HMRC doesn’t support the schedules that your client falls under, then you, as an agent, will have to file an SA100 return instead of an MTD return for your client.

For 2025/26 testing, you can only sign up clients with accounting periods that align with the tax year and for accounting period that runs from 1 April to 31 March. However, accounting periods such as 1 January to 31 December are not supported and would not be eligible for sign-up.

Yes, you can sign up clients with sole trade or property income below the mandated thresholds of £50,000 and £30,000 for Making Tax Digital. You can sign up your client voluntarily if all the conditions for voluntary sign-up are met.