For the UK CA firms, the tax landscape is changing dramatically. Their clients are severely dependent on their guidance to successfully navigate this space. The introduction of Making Tax Digital for Income Tax marks the biggest change to UK tax administration in decades, and it is arriving sooner than many business owners realise. As their principal adviser, CA firms are perfectly positioned to guide them through this transition smoothly.
According to HMRC’s latest statistics, over 1.6 million businesses have already adopted Making Tax Digital for VAT, with a compliance rate exceeding 99%. With such huge success, it is clear that with proper guidance and support, clients can seamlessly adapt to digital tax reporting. The challenge? Many sole traders and property owners do not yet understand what’s coming or why it matters to them.
If you are dealing with such clients, this comprehensive guide will equip you with 10 battle-tested strategies to help them confidently embrace MTD for Income Tax compliance, turning what seems like a daunting mandate into an opportunity for improved financial management.
Step 1: Invest Time to Educate Clients on Making Tax Digital for Income Tax
Before you begin educating the clients on making tax digital, let us have a quick look at the benefits of MTD. Once your clients know the benefits, your job becomes easier.
- MTD is a highly effective way of digital record keeping, making the entire tax filing process error-free and efficient.
- According to the HM Revenue & Customs guidance, the phased rollout begins from 6 April 2026 for many sole traders/landlords. (Source: GOV.UK)
- For businesses that adopt MTD early, there will be no last-minute scrambles, simplified end-of-year reporting, and stronger audit trails.
Key takeaway: You must position MTD as a business enabler, not just a new rule. It will help your clients engage with it proactively.
Practical knowledge goes a long way when educating your clients about MTD for Income Tax compliance. You can conduct one or more weekly workshops with your clients covering:
- When is MTD for Income Tax coming, and what does it mean for them?
- Important deadlines and thresholds that apply to them.
- How will digital record-keeping, the MTD approved software, and quarterly updates work?
- ‘What MTD means for you,” focusing on sole trader, landlord, small partnership
- Q&A and next steps homework
Deliver a visual walk-through of MTD-compatible software, demo a digital record-keeping example, and show the “before vs after” of manual vs digital. This will help them understand the entire shift clearly.
Key takeaway: Making the workshop interactive will help them understand MTD for Income Tax tools and workflows better.
Proper client onboarding will make the entire process a lot easier. Here’s what you can include in your checklist:
| Step | Description | Why it matters |
|---|---|---|
| 1 | Establish if the client is in-scope for MTD for Income Tax | Over-income threshold? Landlord/self-employed? |
| 2 | Decide the record-keeping method featuring MTD approved software and bridging tool | Digital recordkeeping is mandatory under MTD for Income Tax. |
| 3 | If you are the agent for your clients, get agent access. | You will need access to their digital records and submissions. |
| 4 | Establish timeline for first quarterly submission and annual end-of-period statement | Helps avoid last-minute panic. |
| 5 | Provide training/resources on MTD for Income Tax tools and software | Empowers client to feel confident and compliant. |
Key takeaway: With a clear onboarding checklist, your clients get all the support they need and nothing slips through the cracks during the implementation of MTD for Income Tax.
You must maintain regular, clear, and crisp communication with your clients. Use short, targeted communications like:
- Weekly or fortnightly e-bulletins: MTD for Income Tax tip #1: why digital records save time
- Short video clips or GIFs explaining concepts, e.g., “What is an end-of-period statement?”)
- A “MTD for Income Tax FAQ” sheet that they can refer to at any time
By maintaining regular communication, you ensure your clients stay updated throughout the journey rather than dumping a bulk of information all at once. Your clients feel you are actively supporting them through the change, with MTD for Income Tax client support at the forefront.
Key takeaway: Use simple FAQs, videos, and other media formats to reduce client anxiety about the change to MTD for Income Tax.
If you want your clients to sail through the MTD changes seamlessly, you need to train them. Here is how you do that:
- Conducted webinars to introduce them to MTD for Income Tax
- Conduct practical sessions on choosing and using MTD-compatible software.
- Organize a quick refresher course before the first quarterly submission.
- Introduce them to property income or multiple income streams on MTD for Income Tax resources.
By having your clients complete the layered training sessions on MTD for income tax, you will help them navigate the changes with confidence and competence.
Key takeaway: By having properly structured training sessions, you strengthen your clients’ ability to comply and position your practice as their trusted guide in the MTD for Income Tax journey.
If you cater to clients from different income groups or streams, you must create your own MTD resources to educate them. Here are some resources that we feel can help:
- An infographic explaining MTD for Income Tax in a nutshell
- Top 10 FAQs on MTD for Income Tax
- Case-studies showcasing how your clients can organize their quarterly updates
- A sheet comparing all the latest HMRC approved MTD for Income Tax tools and the features to look for
By having these resources at your disposal you give your clients something that they can easily access and you get a toolkit that helps you answer client queries repeatedly, without worrying.
Key takeaway: Having client-friendly resources makes your communication seamless and more credible.
Here are some key do’s and don’ts of Making Tax Digital for income tax that you must share with your clients:
Do’s
- Maintain and update digital records of income and expenses right from the beginning, irrespective of your due date.
- Get MTD-compatible software early and test it.
- Give your agent access early.
- Submit your quarterly updates on.
- Keep your practice updated for any possible regulatory change.
Don’ts
- Do not wait until the last minute to engage with MTD for Income Tax.
- Do not use or rely completely on manual spreadsheets without a bridging tool.
- Do not ignore property or multiple income streams.
- Do not assume small income means you are safe, there can be a change in thresholds and you may move into scope.
- Do not assume you are exempt without checking.
Key takeaway: Clear do’s and don’ts keep clients from unwelcome surprises and help you establish best-practice guidance around MTD for Income Tax compliance.
Data is the best visualizing tool, it helps clients have clear understanding of the benefits of MTD for income tax. Here’s a table that you can use to highlight the benefits of MTD for income tax.
Data and timelines help clients feel less passive and more in control.
| Gross income (self-employed/property) | First MTD for Income Tax start date | What it means |
|---|---|---|
| £50,000+ (2024/25 tax year) | 6 April 2026 | Client must be ready by then. |
| £30,000+ (2025/26 tax year) | 6 April 2027 | Next wave. |
| £20,000+ (2026/27 tax year) | 6 April 2028 | Future readiness. |
Key takeaway: By showing right facts and timelines regarding MTD for Income Tax it helps your clients stay updated on all the latest happening on MTD front.
Instead of going all at once, it is always better to spread out milestones for your clients. You can have the process like:
- Month 1: Complete client onboarding
- Month 2: Identify and propose HMRC-approved software and authorise agent access
- Month 3: Client started digital record-keeping practice
- Month 6: Review the digital records for any possible inconsistencies or errors
- Carry out a mock submission or test run a quarter before the client’s in-scope start date.
- Carry out a quarterly review of updates post-start date, and see how your client is doing.
By staging these check-ins, you will always remain in touch with your clients and can guide them effectively through the transition.
Key takeaway: By having milestones and check-ins in place, you minimize the risk and ensure the move to MTD for Income Tax is smooth and supported.
When preparing your clients for MTD for income tax, you often will come across same questions repeatedly. Hence it is better to have your own FAQs handy with you always. Some of the questions that you can have in as part of your FAQs include:
- Do I need to send a full Self Assessment tax return when I’m in scope of MTD for Income Tax?
- What if I have both self-employment income and rental property income?
- Can I still use spreadsheets?” (Yes. If digitally linked via bridging software)
- What happens if my income drops below the threshold after I start?
- When do the quarterly updates need to go in?
- What if I’m digitally excluded and can’t use the software? (There is an exemption route)
By having these FAQs ready you will not need to have the same discussion with different clients every time they have a doubt, making the overall engagement less reactive and more proactive.
Key takeaway: Having a detailed list of FAQs around MTD for income tax will help you build trust, reduce your support burden and reinforce your role as the go-to advisor for MTD for Income Tax.
For CA firms, there is an opportunity to educate clients about Making Tax Digital for Income Tax (MTD). MTD for income tax is not optional; it is very much a mandate from HMRC. Thus, by leveraging the 10 practical methods outlined above, you can help your clients transition smoothly, reduce risk, and build a stronger partnership with them. In educating your clients, you not only introduce compliance but also shape client success. If you need help getting your practice ready or helping your clients get ready for MTD for income tax, write to us at marketing@datamaticsbpm.com, and we will have our UK tax experts help your practice get ready.
What is making tax digital?
Making Tax Digital” refers to the UK government’s initiative for businesses and individuals to keep tax records digitally and submit tax data online, using MTD-compatible software.
How does making tax digital work?
For MTD for Income Tax, when in scope you’ll keep digital records of income and expenses, use software that can link to HMRC, send quarterly updates and an end-of-period statement.
When is making tax digital coming in?
For MTD for Income Tax: From 6 April 2026 for those with gross self-employment/property income over £50,000. Then: 6 April 2027 for over £30,000. Then: 6 April 2028 for over £20,000 (subject to legislation).
What making tax digital means for accountants?
It means you will need to advise clients on software, onboarding, digital record-keeping, quarterly updates and new workflows. It presents a chance to deepen client relationships and provide more strategic value.
How do I register for making tax digital?
For your client: Use HMRC’s sign-up portal for MTD for Income Tax, authorise your firm as their agent, ensure software is linked and you’re ready to submit updates.
