Webinar
How does Bright’s HMRC-recognised MTD solution work?
Register to watch an expert-led session on how Bright’s HMRC-recognised Making Tax Digital (MTD) solution supports UK accounting practices with quarterly filing, year-end declarations and workflow automation ahead of the 2026 MTD for ITSA rollout. You’ll see how BrightBooks, BrightTax and BrightManager work together to simplify compliance and reduce administrative burden.
One connected MTD for ITSA solution for mixed client bases
Manage MTD for ITSA submissions, final declarations and client workflows in one platform, without forcing all clients onto the same bookkeeping software.
What you need to know about
MTD for Income Tax requirements
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) requires UK self-employed individuals and landlords to keep digital records, submit quarterly updates to HMRC and complete a final declaration each tax year using MTD-compatible software.
- Digital record keeping
- Using spreadsheets for MTD
- What records must be kept digitally
- Quarterly updates to HMRC
- Final declaration (Self Assessment)
Digital record keeping for MTD for ITSA
Digital record keeping means your clients must record income and expenses in a digital format that can be submitted to HMRC through MTD-compatible software. These records are then used to create quarterly updates and the final declaration, reducing manual data entry and duplication.
Records can be kept in accounting software or spreadsheets, as long as they are connected to HMRC using bridging or MTD-recognised software.
Using spreadsheets for MTD for ITSA
Using spreadsheets for Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is allowed for clients who do not use bookkeeping software. However, spreadsheets must be connected to HMRC using MTD-compatible bridging software to submit quarterly updates and the final declaration.
What records must be kept digitally for MTD for ITSA?
For Making Tax Digital for Income Tax Self Assessment (MTD for ITSA), clients must keep digital records of income and expenses in a format that can be submitted to HMRC using MTD-compatible software. This includes sales invoices, purchase receipts and bank transaction records.
Any supporting financial information used to calculate the figures sent to HMRC should also be stored digitally to meet MTD record-keeping requirements and reduce the risk of errors.
Quarterly updates to HMRC
Quarterly updates for Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) require clients to submit summaries of income and expenses to HMRC every three months using MTD-compatible software.
These updates are not tax calculations or final figures. They provide HMRC with an in-year view of business income and help practices keep client records up to date ahead of the final declaration.
Final Declaration (Self-Assessment)
The final declaration for Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is submitted at the end of the tax year to confirm the client’s income and expenses and make any adjustments to the quarterly updates sent to HMRC.
This replaces the traditional annual Self Assessment submission process by confirming the final figures used to calculate the client’s Income Tax and National Insurance liability for the year.
Who is included in MTD for ITSA?
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) applies to UK taxpayers who have self-employment or property income above the HMRC threshold. The rollout is being introduced in phases to give practices and clients time to prepare. Qualifying income refers to the combined gross income from self-employment and property.
- From April 2026: Individuals with qualifying income over £50,000 must comply with MTD for ITSA
- From April 2027: Individuals with qualifying income over £30,000 will be included
- From April 2028: Individuals with qualifying income over £20,000 will be included
What are quarterly updates in MTD for ITSA?
Quarterly updates in Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) require clients to submit summaries of income and expenses to HMRC every three months using MTD-compatible software.
These updates are not final tax calculations. They provide an in-year view of business income, helping practices keep records up to date and reducing surprises when completing the final declaration.
What is the final declaration for MTD for ITSA?
The final declaration for Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is submitted at the end of the tax year to confirm the client’s income and expenses and make any adjustments to the quarterly updates sent to HMRC.
This submission includes any corrections or additional information not reported in quarterly updates and allows HMRC to calculate the client’s final Income Tax and National Insurance liability for the year.
How can practices manage MTD clients at scale?
Managing clients under Making Tax Digital (MTD) introduces new workflows, deadlines and reporting requirements for UK practices. BrightManager helps practices manage MTD client workflows, track HMRC submission statuses and coordinate quarterly update processes from one central dashboard.
This makes it easier to monitor progress across large client bases, reduce manual follow-ups and maintain consistent compliance as MTD for ITSA rollout expands.
Helping you
Featured resources
These resources explain how MTD for ITSA works in practice, including compliance requirements, timelines and software options for UK practices.
Guide: Adapt your pricing models for MTD profitability
An essential guide to protect your accountancy profitability and turn MTD work in to an opportunity.
Video: MTD explained
Get MTD explained in under 5 minutes with our simple to follow video, perfect to share with clients or your team.
Your MTD checklist
This checklist is an essential resource for accountants and tax professionals, giving you a structured guide to transition your clients to MTD for ITSA.
FAQs: Key answers to client questions
Get an easy-to-read guide to answer your clients questions using HMRC information, including explanations of quarterly updates, final submissions, and more.
Easy comms: Prewritten letters
Download our prewritten letter templates to save time when communicating with your clients about MTD.
