HMRC’s Digital Changes: What You Really Need (And What You Don’t)

As HMRC continues its push toward digitalisation, many businesses are understandably confused about what’s required and what isn’t. Making Tax Digital (MTD) is evolving, and while it will bring changes to the way VAT, Income Tax, and eventually Corporation Tax are reported, not everyone needs to invest in expensive new systems just yet.

But here’s the problem: some accountants will treat this as a golden opportunity to upsell clients on costly software packages and full accounting system overhauls—whether they need them or not.

The Changes

From 6th April 2026, landlords or self-employed individuals with an annual business income exceeding £50,000 will be required to maintain digital records and provide HMRC with updates on their financial position on a quarterly basis throughout the year. From April 2027, all self-employed individuals or landlords with a business income of £30,000 or over will fall within the scope of MTD.

As a result of the coming changes, you will be required to:

• Keep digital records
• Use software that is compatible with HMRC’s API
• Submit quarterly returns

It is highly recommended to start this transition to MTD as soon as possible to ensure that by the deadline above, you understand the systems and have all the necessary records to ensure you are fully compliant with HMRC’s regulations. You may receive an email or letter from HMRC outlining these changes in the next few months.

Bridging the Gap Without Breaking the Bank

If you’re a small business or landlord and your current setup works for you, there’s a good chance you can stay compliant with simple bridging software a much cheaper and more straightforward solution. These tools allow you to link spreadsheets or basic systems to HMRC’s platform without having to buy into a full cloud accounting package.

We’ve already seen many firms recommend cloud subscriptions or full system migrations to clients with relatively straightforward needs. That might be right for some but for others, it’s overkill. Why pay for features you’ll never use?

Honest Advice, Case by Case 

Our approach is simple: look at each client’s needs individually and offer the best solution for their situation. If bridging software will do the job, that’s what we’ll recommend. If your circumstances call for a more robust system, we’ll be honest about that too, but you’ll get a recommendation based on facts, not profit margins.

This fair and balanced approach isn’t just the right thing to do—it’s also something we believe more people are looking for. As clients start to question the rising fees and one-size-fits-all advice from their current advisers, there’s a real opportunity for firms like ours to provide a more transparent, tailored service.

A Chance to Do Better

We see the upcoming HMRC changes not as a sales opportunity, but as a chance to offer better guidance and earn trust. If you're unsure what the digital changes mean for you, or if you're being told you need an expensive new system, come and speak to us. You might be surprised at how simple and affordable compliance can be.