In just less than a fortnight, from the 6th of April 2026, Making Tax Digital for Income Tax (MTD IT) will apply to sole traders and landlords earning over £50,000. It’s changing what used to be just one annual tax return submission each year into now four quarterly submissions a year.
The question on every accountant’s mind is likely how to properly price these new MTD IT requirements.
Do I need to increase my firm’s pricing for MTD IT?
Clients think that MTD IT is just a quick click of a button four times a year instead of one.
As you know, this isn’t the case. It’s additional client chasing, bookkeeping, and query resolutions. On top of that, there are also additional submissions, approvals, and lots of deadline management.
You’re looking at about six to twelve additional hours per client each year. If you have 50 clients, that’s roughly 400 hours… or 10 working weeks. Yikes. So much more than a click of a button, right?
There’s going to be a lot more work required on your end to comply with MTD IT requirements, and it’s important that you get paid for it. To avoid any kind of scope creep, you’ll need to increase the cost of your services.
What’s the best approach to increase fees for MTD IT?
It’s important to not just divide your current annual fee by four. That’s undervaluing the huge amount of extra work you’re going to be undertaking.
Work out what the actual requirements will be from these new MTD IT tasks and charge accordingly.
One of the easiest ways to do this is to look at how you currently charge for VAT services. It’s a similar quarterly process that’s reviewing information, making sure it’s accurate, and submitting to HMRC.
How can I communicate MTD IT price increases effectively to clients?
You need to be confident and understand the value that you’re providing to the client. That way, you can explain why there needs to be a price jump and have the evidence at hand to back you up.
Here are a few communication tips to keep in mind:
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Stop apologising
If you’re constantly apologising for price increases, clients could see that as a weakness. If you don’t feel confident asking for extra income, they might feel it’s unwarranted. This could result in you retreating to discounts or old prices.
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Acknowledge the reason
If you can very clearly acknowledge how the pricing is structured and why it’s costing a little bit more, it eliminates objections. You need to name the reason clearly and concisely, so everyone’s starting on the same page. That way, there’s nothing reason to object as it’s clearly stated out for them.
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Make the value visible
Before you pick up the phone or press send on an email, make sure the value it offers clients shines. Don’t assume that they’re aware of how it benefits them, as they might not understand anything about MTD IT.
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Stay calm if you get pushback
If they push back, acknowledge it and then reiterate the value it holds. As long as you have logical and transparent pricing, you have nothing to fear. Hold your ground, be calm and confident, and remind yourself – if they don’t value your work, do you even want them as a client?
What are innovative ways to package MTD IT pricing?
Once you’ve decided what to charge clients for MTD IT services, next is how to package that pricing properly. Here are a couple of pricing models you could implement.
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Subscriptions and retainers
Moving to predictable monthly fees is an excellent way to manage the new quarterly rhythm of MTD IT. For your firm, it guarantees steady cash flow while breaking up the cost into more manageable chunks over the year for your clients.
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Bundled packages
When you bundle services, clients can see the value more clearly. It ensures you get paid for the full scope of work you undertake, leaving no hidden admin tasks unbilled.
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Tiered pricing structures
You could have three to five pricing tiers that charge more for clients with more complex finances or who need lots of support. On the flip side, you can choose more competitive tiers for clients with simpler requirements that are more straightforward to work with.
How can I segment my client base?
Not all clients will experience MTD IT in the same way. Group them on factors like the number of income sources they manage, the communication tools they use, and how often they send in queries.
For example, a landlord with a single property using cloud software doesn’t need much support. On the other hand, a coffee shop owner with thousands of receipts in a shoebox who uses a spreadsheet to track their finances would need far more support.
MTD for IT will either make or break your practice
MTD IT will do one of two things to your firm:
- It will make your workload explode, keep your revenue flat, eat up your evenings and weekends, and build team resentment.
- It will fund your firm and give it a competitive edge. Revenue grows with your workload, cash flow is predictable, and clients understand and value you.
Remember that just because MTD IT may take an extra 10 hours per client, doesn’t mean it has to. There are ways you can speed up the time it takes to process receipts and communicate with clients throughout the year.
At the end of the day, it’s all about efficiency. By pricing your services correctly that truly represent the work you’re undertaking, MTD for IT can look like a profitable journey ahead.
Our MTD hub has everything you could need to learn about when it comes to staying efficient and compliant with MTD for IT for the 2026/27 tax year. Check it out now.
