Making Tax Digital: What It Means for Your Business

Staying ahead of tax changes is easier when your accountant is ready by design.

At Love Accountancy, we have been MTD-ready from the start, meaning our clients can move confidently into the future of digital tax compliance without extra hassle, stress, or hidden costs. If you are wondering what Making Tax Digital (MTD) means for your business and how to prepare, you are in the right place.

Why This Matters

Keeping on top of tax deadlines and compliance requirements can be time-consuming, especially when HMRC rules keep changing. MTD is not just about ticking a box; it is about making your financial processes more efficient, saving you time, and reducing the risk of errors. Businesses that embrace digital tools like Xero not only stay compliant but also benefit from real-time visibility of their finances.

At Love Accountancy, MTD is built into how we work, helping you focus on growing your business – not grappling with spreadsheets.

The Solution: What You Need to Know About Making Tax Digital

Step 1: Understand What MTD Covers

MTD is being rolled out in phases:

• VAT: Since April 2019, VAT-registered businesses with taxable turnover above £85,000 have been required to comply with MTD. From April 2022, this extended to all VAT-registered businesses, regardless of turnover.

• Income Tax Self Assessment (ITSA): MTD for ITSA will become mandatory in phases:

  • From 6 April 2026, for individuals with income over £50,000 from self-employment or property.

  • From 6 April 2027, for those with income over £30,000.

  • From 6 April 2028, for those with income over £20,000.

• Corporation Tax: MTD for Corporation Tax is not expected before April 2026, with a voluntary pilot anticipated prior to it’s compulsory.

Step 2: Choose MTD-Compliant Software

If you are already using Xero, great news – you are already set for MTD, you just might need to tweak some of your processes. If not, we make switching effortless with cloud-based onboarding that gets you running quickly and smoothly.

Step 3: Set Up Digital Record Keeping

Gone are the days of paper receipts and manual spreadsheets. MTD requires maintaining accurate, real-time financial records electronically.

Step 4: Submit Your Returns Digitally

MTD returns are filed directly through your software to HMRC. No more manually entering figures or worrying about transcription errors.

Step 5: Partner with an MTD-Ready Accountant

Love Accountancy integrates MTD compliance into every part of our service. We make sure your systems are not just compliant, but working for you – giving you peace of mind and more time to focus on what matters most.

Expert Tips and Common Pitfalls

Expert Tip:
Start early. Even if MTD deadlines for income tax or corporation tax feel far away, the sooner you set up good digital habits, the smoother your transition will be.

Common Pitfall:
Leaving MTD compliance to the last minute can lead to rushed setups, missed deadlines, and unnecessary penalties. If your accountant has not yet mentioned MTD – or seems unsure about the process – it might be time for a change.

At Love Accountancy, we were built with MTD in mind. It is not an afterthought; it is how we help make accounting effortless for you.

Call to Action

Ready to make tax digital the easy way?
At Love Accountancy, we make MTD compliance seamless. Book a free call today and find out how effortless accounting can be when you have the right partner by your side.

About Love Accountancy

Based in Exeter, Love Accountancy provides expert, technology-driven accounting services to small and medium-sized businesses across Devon and beyond. Whether you need help with Making Tax Digital, Xero onboarding, or strategic financial advice, we are ready to help you grow. Love Accountancy | Accountants that care