MTD software for Income Tax
Written by Akhtar Rana, FAIA · Last reviewed
If you are a landlord or a sole trader who has to use Making Tax Digital for Income Tax, you will need software that keeps digital records and files directly with HMRC. There is no single “best” product: it depends on how you work. Here is what actually matters when you choose, what landlords in particular need, and the shortcut most of our clients take.
Figures are correct at the date of review. Always check GOV.UK for the latest.
The short answer
MTD software for Income Tax is any HMRC-recognised product that keeps your records digitally and files your quarterly updates and final declaration for you. Landlords and the self-employed are the ones who have to use it, from April 2026 for those over the £50,000 threshold, and the right choice is the one that fits how you work. HMRC keeps an official list of compatible products, and options range from full accounting packages to simple “bridging” tools that connect a spreadsheet to HMRC.
MTD software for landlords
If you let property, look for software with proper property features: it should separate each property and track the rent and typical costs (letting fees, repairs, insurance, ground rent) against it, then roll your UK properties up into the one property-business figure HMRC wants each quarter. There is no single “best” landlord product; the right one depends on how many properties you have, whether any are jointly owned, and how hands-on you want to be. Rather than push a single brand, we recommend and set up the one that fits your portfolio. For the wider property tax picture, see our accountants for landlords page and MTD for landlords guide.
Two broad types
- Full accounting software: keeps your records and files with HMRC in one place, usually with bank feeds, invoicing and mobile apps. Simplest if you want everything joined up.
- Bridging software: lets you keep records in a spreadsheet and file to HMRC through a connector. Handy if you have an existing spreadsheet system you don’t want to change.
Both are valid for MTD. The right choice depends on how comfortable you are with software, how many income sources you have, and whether you’d rather manage it yourself or hand it over.
What to look for
- On HMRC’s compatible list: non-negotiable; check before you commit.
- Digital record-keeping: captures income and expenses, ideally with bank feeds.
- Files quarterly updates and the final declaration: end to end, not just records.
- Handles multiple sources: separates each trade and property cleanly.
- Fits your day-to-day: mobile app, receipt capture, and a workflow you’ll actually use.
- Support and cost: a price and level of help that suits you.
Where to check compatibility
HMRC publishes and updates the official list of MTD-compatible software on GOV.UK. Because the list changes as products are approved, it’s the source of truth. Always confirm a product is listed for Income Tax (not just VAT) before you sign up.
The shortcut most of our clients take
Rather than research and set up software themselves, most of our clients let us do it. We recommend an MTD-compatible package that suits your business, set it up, connect your bank, keep the records tidy, and file everything for you, on a fixed monthly fee. So the “which software?” question stops being your problem. Take our 2-minute quiz or see how our bookkeeping works.
Akhtar Rana, FAIA
Akhtar is the founder of Xpert Tax Accountants and a Fellow of the Association of International Accountants, holding an AIA practising certificate. He works with business owners across Greater Manchester and the rest of the UK.
Verify his membership on the AIA register →
Xpert Tax Accountants is regulated by the AIA. We are not authorised by the Financial Conduct Authority and do not give investment, pension or insurance advice.
Xpert Tax Accountants is regulated by the Association of International Accountants. We are not authorised or regulated by the Financial Conduct Authority and we do not give investment, pension or insurance advice, or arrange financial products. Our content is general information about UK tax, not advice for your circumstances, and no responsibility is accepted to any person acting on the basis of it.
Frequently asked questions
Common questions about MTD software.
What is MTD-compatible software?+
Software that HMRC recognises for Making Tax Digital: it keeps your records digitally and files your quarterly updates and final declaration directly with HMRC. HMRC publishes a list of compatible products on GOV.UK.
Do I need a full accounting package, or is a spreadsheet enough?+
You can keep records in a spreadsheet, but it must connect to HMRC through “bridging software”. Many people find a full package simpler, because record-keeping and filing live in one place. The right answer depends on how you work.
Which software is best for landlords?+
Landlords often prefer software with strong property features: separating properties, tracking rents and typical costs. The “best” one is whichever matches your setup; we’ll recommend and set up the right fit rather than push a single brand.
Do you choose and set up the software for me?+
Yes. We recommend MTD-compatible software that suits your business, set it up, connect your bank, and handle the filing, so “compatible software” is one less thing to think about.
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