Do You Need an Accountant for Making Tax Digital?
Table of Contents
Making Tax Digital for Income Tax changes how UK sole traders and landlords keep records and report to HMRC – but it doesn’t answer the more personal question of whether you should handle it yourself or bring in an accountant. The honest answer depends on your affairs, not your software. This guide covers what actually changes under quarterly updates, what an accountant does that software can’t, the DIY and hybrid routes people are choosing, and how to work out which fits you.
Disclaimer: This article provides general information only and does not constitute tax advice. Consult a qualified tax adviser or accountant for advice specific to your circumstances.
What Actually Changes Under Making Tax Digital’s Quarterly Updates
If your qualifying income was over £50,000 in 2024-25, you’ve been inside Making Tax Digital for Income Tax since 6 April 2026, with the £30,000 and £20,000 thresholds following in 2027 and 2028. The mechanical change is the same for everyone it applies to: instead of one Self Assessment return a year, you send HMRC four cumulative quarterly updates – each covering the year to date, not just the latest three months – with the exact windows and deadlines in our quarterly update deadlines guide. Updates carry only totals per income and expense category, never your actual receipts or invoices, and a nil update is mandatory even in a quiet quarter. After the fourth one, you still finalise the year with a final declaration by 31 January, much like the old tax return.
That’s the part that doesn’t move depending on whether you use an accountant: four submissions a year instead of one, cumulative, nil updates included. What changes is who does the work behind each one – and that’s where the accountant question actually lives.
What an Accountant Does That Software Doesn’t
No amount of receipt-scanning replaces professional judgement. An accountant earns their fee on the parts of MTD that aren’t mechanical:
- Judgement calls on what’s genuinely an allowable expense, especially in the grey areas software can’t weigh up.
- End-of-period adjustments and the final declaration – turning four quarters of category totals into a correctly finalised tax position, with reliefs applied.
- Capital allowances – working out what qualifies, and when claiming it actually benefits you.
- Liaising with HMRC directly if a query comes in, rather than you handling it alone.
- Catching an error before it’s filed – an experienced eye across several quarters spots what software just totals up faithfully, mistakes included.
- Complex situations – self-employment and property income together, multiple trades, or several income sources, all add real complexity a records app alone doesn’t navigate. (See how combined income is treated in our sole trader and landlord guide.)
Miss enough of this and errors compound into missed deadlines and, eventually, points under HMRC’s points-based penalty system – see MTD penalty points explained for how that works.
What Software Actually Does – Two Different Jobs
“MTD software” is a confusing phrase because it covers two different jobs, and no single product has to do both:
- Keeping digital records – capturing income and expenses as they happen, categorised and ready to summarise.
- Filing with HMRC – submitting the quarterly totals and final declaration through HMRC-recognised software, connected to HMRC’s systems.
HMRC is explicit that these can be separate tools, linked digitally rather than bundled into one app – even a spreadsheet remains legal as the records layer, provided it’s digitally linked, with no manual re-typing, to MTD-compatible filing software. That’s exactly why “do I need an accountant” and “which software do I need” are different questions with different answers. More on the split in MTD software vs receipt apps.
The DIY Route: Records App + Filing Software
Going it alone means keeping digital records yourself – in a dedicated app, or a properly linked spreadsheet – and submitting through HMRC-recognised filing software, with no accountant involved. It suits straightforward affairs: one income stream, manageable transaction volume, genuine comfort with numbers and software, and time for quarterly admin four times a year instead of once. It’s a legitimate route – HMRC’s whole model assumes plenty of people will take it – but every judgement call above sits with you, and a wrong or missed update is yours to fix.
The Hybrid Route: Records App + Accountant
The other common pattern is a records app running quietly all year, with an accountant handling the quarterly updates and final declaration from that data. It’s the model HMRC itself describes: dedicated record-keeping software feeding an agent or filing software through a digital link.
This is where Taxr’s free accountant portal fits. Clients scan receipts in the Taxr app as they happen – the AI reads the vendor, date, total and VAT off the photo and files it into a tax-aligned category – and the accountant reviews that clean, categorised data through the portal at portal.taxr.io instead of chasing a shoebox in January. To be precise about what Taxr actually is: it’s MTD-ready expense records that feed your MTD software or your accountant – it doesn’t submit anything to HMRC itself.
What It Costs, in General Terms
Accountant fees vary widely by complexity and location – get a few quotes rather than assume a figure; a straightforward sole trader return costs a lot less to prepare than one with property income, several trades, and VAT on top. Filing software has its own subscription cost, which also varies by provider; gov.uk keeps the current list of HMRC-recognised options.
The one number we can give you precisely is our own: Taxr, on iOS and Android, is free for the first 10 scans, then $2.99/month or $29.99/year (USD) for unlimited scanning, UK VAT handling, and Excel or PDF exports. That cost is the same either way – the records habit doesn’t change based on who ends up filing.
Do You Need an Accountant for Making Tax Digital? Here’s How to Decide
If you’re feeling behind, you’re not alone. HMRC’s own release from 12 August 2026 shows only 436,000 of the 864,000 people mandated from April 2026 had filed their first quarterly update four months in, and separate research from IPSE and Sage found around 70% of sole traders weren’t MTD-ready, with only about one in ten already using cloud accounting software. That gap is a real part of why accountants are busier than usual this year.
| DIY might suit you if… | Consider an accountant if… |
|---|---|
| You have one simple income stream | You have multiple income sources, or self-employment plus property |
| You’re comfortable with numbers and software | You’d prefer someone else to own the numbers |
| Your transaction volume is low | Your transactions are high-volume or complex |
| You have time for admin four times a year | You’re time-poor, or admin already causes errors |
| You’re confident applying expense rules yourself | You want capital allowances and claims judged professionally |
Neither choice is permanent. Plenty of people start DIY and bring in an accountant once affairs get more complex, or the reverse, once records are clean enough that filing becomes routine either way. For the full picture on thresholds, deadlines and penalties, see our complete Making Tax Digital guide.
Start the Records Habit Either Way
Whichever route you land on, Making Tax Digital assumes the same underlying habit: expenses captured digitally as they happen, not reconstructed every January. That’s what Taxr does – point your phone at a receipt and the AI handles the vendor, date, total, VAT and category, ready to hand to your accountant or drop straight into your filing software.