Making Tax Digital - Income Tax Self-Assessment

Making Tax Digital for Income Tax also known as MTD for Income Tax Self-Assessment (MTD ITSA) will change the way millions of business owners and landlords report their earning to HMRC, in essence, making it easier for businesses and individuals to record and declare their tax.

MTD ITSA is the second stage of Making Tax Digital and will replace the current system of annual Self-Assessment tax returns. MTD ITSA comes into effect in April 2024. The most significant change is that instead of sending a Self-Assessment tax return to HMRC once a year, businesses and individuals will submit four quarterly updates. At the end of each tax year, they will also have to send an end of period statement (EOPS) and final declaration.

Why?

This forms part of the Government strategy for Making Tax Digital with the aim of HMRC becoming one of the most digitally advanced tax administrations in the world. In the process, this will save businesses and individuals time, helping to eradicate errors for those managing their tax affairs.

Who does this affect?

This is applicable to self-employed business owners and landlords, and in April 2025 for partnerships with individual partners. Other types of partnership will join at a future date.

    
 
 
       Posted on Google  
    Simon Tilley 
 09/09/2026
 
 
  Great service from Katie and the team at Elsby. Would highly recommend!
  
 
      Posted on Google  
    Katie Platt 
 14/08/2026
 
 
  Fabulous company, everyone is so helpful and professional! Special mention to Louise and Chrissy on the admin team, they are so efficient and hard working
  
 
      Posted on Google  
    Josh Edwards 
 07/08/2026
 
 
  Following on from my last review, I would also like to extend my sincere thanks to Louise, Katie and Lynda, who have all worked tirelessly to get my company’s accounts back on track. It really does show that teamwork makes the dream work. Once again, all of the team are only a phone call away and are always proactive, knowledgeable and efficient when dealing with any queries or issues. Their professionalism, dedication and support have been outstanding, and I can’t thank them enough.
  
 
      Posted on Google  
    NICESHOUT. DESIGNED FOR LIVES 
 05/08/2026
 
 
  Brilliant accountants. Really helpful, friendly and  very efficient. Got back to me really quickly. I dealt with Dominic and he was brilliant. Fully recommend.
  
 
      Posted on Google  
    Joshua Edwards 
 03/08/2026
 
 
  I can’t recommend Elsby & Co highly enough. They have helped get my business back on track and ensured everything is in order and on the right side of HMRC. Nothing is ever too much to ask, and the service has been outstanding from day one. Jamie (my account manager)is always at the end of the phone to answer any questions, no matter how big or small, and his advice has been invaluable in helping me run my business with confidence. If you’re looking for an accountant who is professional, approachable, and genuinely cares about your business, I wouldn’t hesitate to recommend Elsby & Co.
  
 
      Posted on Google  
    A. Hooton 
 30/07/2026
 
 
  I can’t praise Elsby accountancy enough. An excellent highly professional service with clear communication, reliability and friendliness. My special appreciation goes to James Fairweather who leaves no question unanswered with his astonishing knowledge and ultra fast responsiveness . I couldn’t be in better hands and have total peace of mind. Highly recommended !
  
 
      Posted on Google  
    Russ Edwards 
 29/07/2026
 
 
  Great Company, knowledgeable, very professional, prompt, super helpful, nothing seems to much trouble, I would highly recommend them.
  
 
      Posted on Google  
    natasha arnold 
 29/07/2026
 
 
  Elsby have been doing my tax returns for nigh on 10 years and from the start they were so helpful with both advice and tips to ensure my return was both comprehensive and accurate. They have saved me the hours of work preparing my tax return that makes me so relieved that I would pay any price; Their charges are great, given how consistently reliable they are. Can  highly recommend their services.
  
 
      Posted on Google  
    Mark Ferguson 
 27/07/2026
 
 
  Having recently moved More Fire PR Ltd across to Elsby & Co, I've been extremely impressed with the service I've received. Claire, Harry and the team have been responsive and proactive throughout the transition, taking the time to explain the reasoning behind their advice rather than simply processing accounts. They've helped streamline payroll, improve our tax planning, introduce Xero and provide much greater visibility of the business finances. No question has been too much trouble, and I've always received clear, prompt and professional responses. As a business owner, it's reassuring to have accountants who genuinely act as trusted advisers rather than just year-end compliance specialists. I'd have no hesitation in recommending Elsby & Co to other owner-managed businesses.
  
 
      Posted on Google  
    S RC 
 12/06/2026
 
 
  I've been suing Elsby & Co for a number of years and I've found the the perfect match for my tax affairs.
  
 
  
  
 
 
   Google rating score: 5.0 of 5, based on 121 reviews

How should I keep my records?

Businesses and individuals will need to keep digital accounting records. Digital records can be achieved by using compatible accounting software, such as Xero, QuickBooks, Sage, and many others. Where businesses decide not to use an accounting software, an alternative option is to use bridging software. Businesses can maintain spreadsheets which are used in conjunction with the bridging software. Digital links must be in place to ensure records are kept digitally as information is passed between the different platforms.

Bridging software can be a more cost effective and simpler option for businesses who are not yet able to move to an accounting software.

Where businesses currently use a desktop or cloud-based accounting software, you will need to ensure that the package is fully compliant with MTD. The best way to check this is to contact your accountant or the software provider directly.

Are there any exemptions?

As with MTD – VAT, there are likely to be some MTD exemptions if it is not reasonable or practicable for businesses to use digital tools for their tax. Businesses would have to apply for an MTD exemption via the GOV website. Businesses that have previously received exemptions from digital filing are likely to continue to have exemptions to MTD requirements.

What are the next steps?

You can sign up as an individual for MTD ITSA via the GOV website . If you’re working with a recognised provider (typically an accounting firm like Elsby), you can sign up now assuming the provider uses software that works with Making Tax Digital for Income Tax.

For those wishing to help test and develop MTD ITSA before 6 April 2024, you may be able to voluntarily sign up through your software provider.

Businesses who have failed to sign up in time or have failed to retain digital records or digital links may be charged penalties.

Our cloud accounting credentials

We don’t just understand digital and cloud accounting, we excel at it. We are a Xero Platinum Partner and were the first accountancy firm in the world to receive a Xero migration certification. Our 5-star ratings on Reviews.io and Google are a result of the strong relationships, satisfaction and trust we have built with our clients.

We can support you with the following:

Transitioning to accounting software, including advising on the best options and providing software training
Providing bridging software
Registering for MTD
Reviewing current processes and VAT returns for confidence of compatibility
Advice/support on claiming MTD exemptions

We focus on giving you the right advice to help your company grow

Get a Quote