Making Tax Digital Software: What You Need and How to Choose
By Marina Jahan ·
Reviewed by Shamayun Chowdhury, CIMA ·
Tax year 2026/27 · Last reviewed [22 September 2026]
Quick answer
Making Tax Digital software is any product HMRC recognises as able to send your figures through its Making Tax Digital service. Nothing else will file, because HMRC builds no software of its own and closed the manual route. Two kinds qualify: full accounting packages that hold your records and file from them, and bridging tools that take figures from a spreadsheet and pass them to HMRC.
Do you need software at all?
Only if you are filing yourself. The legal duty is that submissions reach HMRC through compatible software, not that you personally operate it. An accountant acting as your agent files from their own system, which is why some of our clients have never opened an accounting app. Do I need software for Making Tax Digital when my spreadsheet already does the job? The spreadsheet can stay; it simply cannot talk to HMRC. Pair it with a bridging tool and you are covered.
What is MTD software?
What is MTD software, stripped of marketing? A program with a licence to talk to HMRC’s Making Tax Digital service. Behind every product is the same connection, an API, and HMRC tests each one before it appears on the list. Everything else, from the design to the bank feeds, the phone app and the price, is the vendor’s own work.
That one fact explains most of the muddle around MTD filing software, and it has three knock-on effects.
HMRC is not a supplier. There is no government product, no gov MTD software, and no HMRC software for making tax digital to download. The MTD software gov uk pages point you to commercial suppliers, nothing more. Anyone offering “official HMRC MTD software” is describing a private product.
You cannot file from your HMRC account. The old habit of logging in and typing figures into a form has gone for anyone inside the rules. Submissions leave the software.
The software carries the obligations. Making tax digital software requirements are set by HMRC rather than the vendor, so a product either meets them or is not on the list.
The same thing, under a dozen names
Vendors and search engines use different labels for one category. Make tax digital software, MTD tax software, MTD softwares, MTD it software, software making tax digital, making tax digital software UK, MTD software UK and UK MTD software all point at the same shelf. So do the compliance-flavoured versions: MTD compliant accounting software, making tax digital compliant software, mtd-compliant software, accounting software that is MTD compliant, MTD compatible accounting software and software compatible with MTD.
The HMRC-flavoured versions are worth separating out, because they imply an endorsement that does not exist. HMRC making tax digital software, making tax digital software HMRC, making tax digital HMRC software, HMRC make tax digital software, MTD HMRC software, HMRC software MTD, HMRC software for MTD, HMRC accounting software for making tax digital and HMRC making tax digital compatible software all describe commercial products that appear on an HMRC list. The list is the only thing HMRC owns.
What MTD-compatible software has to do
HMRC’s guidance sets out the jobs your product must handle for Income Tax:
- Create, store and correct digital records of self-employment and property income and expenses
- Send quarterly updates, which are summaries rather than tax returns
- Let you add your other income and file the tax return by 31 January
- Take in the information HMRC sends back to you
Checked against HMRC’s software guidance on GOV.UK.
Digital records are needed only for trade and property. Pensions, savings interest, dividends and your share of partnership profit do not need digital records, but your software still has to report them on the tax return. A product that handles quarterly updates beautifully and cannot carry your other income is only half a solution.
Some products cover all four. Others handle only the submission and expect your records to live elsewhere, which is legitimate as long as the link between the two is digital.
“HMRC approved software” and what the phrase really means
Search volume says people look for HMRC approved MTD software, HMRC approved software for making tax digital, making tax digital approved software and MTD approved software. HMRC’s own word is different, and the difference matters.
HMRC recognises software. It does not approve, endorse, rate or recommend any product. Recognition means one thing: the product passed technical testing and can submit through the MTD service. It is not a verdict on quality, support, value or suitability for your business.
So when a vendor advertises itself as HMRC approved software for MTD or HMRC recognised MTD software, both are describing the same technical status. Treat the badge as the entry ticket, not the review. The same goes for HMRC making tax digital approved software, which is simply a listed product described in marketing language.
How to check a product is on HMRC’s list
Looking for compatible software for Making Tax Digital? HMRC scrapped its static table in 2025 and replaced it with a software finder tool. You answer a few questions about your situation and it returns a personalised shortlist. Products still being built now sit inside the same tool rather than in a separate “in development” section.
- Open the finder tool for Income Tax, or the VAT list if that is what you file.
- Answer carefully, particularly the questions covering multiple businesses and income beyond your trade.
- Search your existing product by name if you already have one, to see whether it works for Making Tax Digital.
- Check the date you look. New products join as they pass testing, so an HMRC MTD software list copied into a blog post in 2025 is already out of date.
People also search for the HMRC list of MTD software, the HMRC list of MTD compliant software and an MTD compatible software list, hoping for a shortcut. More than 60 products were listed for Income Tax in early 2026, and the number keeps moving. That is why this page does not reproduce the list of MTD software: any copy of it starts decaying the day it is published. The live version on GOV.UK always wins, and the same applies to the VAT list of MTD compliant software.
Is my software MTD compliant?
- Is the product named on HMRC’s current list for the tax you file? That single check settles whether it counts as HMRC MTD approved software, HMRC approved making tax digital software, HMRC MTD compatible software, MTD compatible software HMRC, MTD compliant software HMRC, HMRC MTD ready software or MTD ready software. Same list, same answer.
- Does it cover Income Tax, not just VAT? Recognition for one does not imply the other.
- Is it authorised to act for you? An unlinked product is compliant in theory and useless in practice.
The two types of Making Tax Digital compatible software
Every recognised product falls into one of two camps. Picking the camp first makes the shortlist far shorter.
Full accounting software. Making tax digital accounting software, or accounting software for making tax digital as the longer version goes, keeps your records inside the product. You raise invoices, import bank transactions, categorise costs, and the quarterly update is built from what is already there. Xero, QuickBooks, Sage and FreeAgent are the names most people meet, and there are dozens more on the list, including free tiers.
Bridging software. Your records stay where they are, normally a spreadsheet, and the tool carries the totals to HMRC through a digital link. Your day-to-day routine stays exactly as it is; only the submission moves.
| Which camp | What it suits | What it costs you |
|---|---|---|
| Full accounting software | Anyone who wants bookkeeping and filing in one place, with bank feeds, receipt capture and a running tax estimate | A monthly subscription and a few hours learning the system |
| Bridging software | Anyone with a spreadsheet that already works, simple affairs, or a strong preference not to change | Usually less money, but the bookkeeping stays manual |
Neither is more compliant than the other. HMRC cares that records are digital and the link to submission is unbroken, not which style you prefer. The detail on spreadsheets and digital links sits on our page about bridging software.
Accounting software for MTD: what the extras actually buy you
- Bank feeds, which remove most of the typing
- Receipt capture through a phone camera
- Invoicing and payment chasing
- A live estimate of the tax building up
- Multi-user access, useful once someone else does your books
If none of that appeals, a cheaper compliance-only tool does the legal job just as well. Easy MTD software, in the sense of a simple product that does one thing, is a perfectly respectable choice: accounting software making tax digital buyers often over-specify and pay for features they never open.
What software do I need for Making Tax Digital?
Four questions settle it faster than any product review.
| Question | If the answer is… | Look at |
|---|---|---|
| How do you keep records today? | A spreadsheet that works | Bridging software |
| Paper, or nothing consistent | Full accounting software | |
| How many income sources? | One trade, straightforward | Either; the cheapest compliant option is fine |
| Several trades, or trade plus property | Full accounting software, which separates them cleanly | |
| Are you VAT registered? | Yes | A product covering both VAT and Income Tax |
| No | Income Tax alone is enough | |
| Who will actually file? | You | Any recognised product you can live with |
| An accountant | Possibly none; they file from theirs |
What software for Making Tax Digital if you are a landlord or sole trader?
Sector-specific products exist too, and you will find tools marketed as accounting software for psychotherapists under MTD, for hairdressers, for drivers and for most other trades. They are ordinary recognised products with templates and categories tuned to one profession; check the HMRC listing exactly as you would for anything else. The mechanics are identical, but the useful features differ. Landlords benefit from products that handle multiple properties and separate UK from overseas letting. Sole traders tend to want invoicing and expense capture instead. We cover both in our guides to MTD software for sole traders and landlord MTD software.
What accounting software is compliant with Making Tax Digital? The list decides
Any product on HMRC’s current list, and no product off it. Software compatible with Making Tax Digital is defined by that listing alone. That sounds blunt, but it is the whole test. Popularity, price and brand recognition change nothing: an unlisted package cannot submit, and a small listed one can.
Illustrative example
A sole trader invoices £61,000 a year, keeps a neat spreadsheet and does her own books each Sunday. She adds bridging software for about the price of a takeaway per year and changes nothing else. Her neighbour, a landlord with four flats and a shoebox habit, moves to a full accounting package with bank feeds, because the bookkeeping is the problem rather than the filing. Both are compliant; neither made the wrong choice. Figures are invented to explain the point.
The feature checklist before you buy
Once the type is settled, HMRC suggests checking the product itself against your circumstances. Five points do most of the work.
| Check | Why it matters |
|---|---|
| Does it support every income source you have? | A product built for sole traders may not handle foreign property, and one built for landlords may not handle a trade |
| Can it file both the quarterly updates and the tax return? | Some products stop at quarterly updates, leaving you to find a second tool for January |
| Does it work with your accounting period? | Standard tax-year quarters and calendar quarters are different settings, and not every product offers both |
| Does it allow more than one agent? | Relevant if a bookkeeper and an accountant both act for you |
| What are the limits on the free tier? | Free products often cap transactions or features, and the cap usually bites in your busiest year |
Two extras worth a look. Some products have HMRC Assist built in, which flags likely errors in your return using HMRC’s own data alongside your figures. And if your circumstances are likely to change, a landlord thinking of starting a trade for instance, check the product can take that on before you commit a year of records to it.
One security point. Legitimate software never asks for your Government Gateway password. The connection uses HMRC’s own sign-in screen, and you approve access there. Any product or “agent” asking you to hand over the password itself should be refused.
Running two products side by side
Mixing products is permitted, subject to one hard rule: no submission may be split between them, so each one leaves from a single product. A landlord cannot send half a quarterly property update from one tool and half from another.
What that permits in practice:
- One product per income source. A builder who also lets a flat can run trade records in one package and property records in another, each sending its own update.
- One product per task. Records and quarterly updates in a bookkeeping tool; the tax return filed through something else.
The catch is joinery. If you use two products, they have to work together to cover every requirement between them, and the links have to be digital. For most people one product is simpler; for anyone with an established system worth keeping, the split is a legitimate way to avoid ripping it out.
Your VAT software may not cover Income Tax
This catches out more people than any other software question, and it catches the organised ones: businesses that sorted MTD for VAT years ago and assume the job is done.
Recognition is granted per service. A product tested and listed for VAT has proved it can send VAT returns. Quarterly Income Tax updates are a different set of submissions, tested separately, and a product can be recognised for one and not the other. HMRC’s list is split along exactly that line, which is why you choose Income Tax or VAT before you search it.
Most of the big accounting packages now cover both. Smaller and older tools, particularly VAT-only bridging products bought in 2019 or 2022, often do not.
- Find your product on HMRC’s Income Tax list, not the VAT one.
- Ask the vendor directly whether quarterly Income Tax updates are live, not “coming”.
- Check whether your plan includes it. Some suppliers put Income Tax filing on a higher tier than the VAT-only package you currently pay for.
Being VAT registered does not change your Income Tax position either way. The two regimes are judged separately, as our page on Making Tax Digital VAT returns explains.
Authorising your software with HMRC
Registering for Making Tax Digital and connecting software are two separate jobs, and the gap between them is where filings go missing. HMRC knows to expect updates from you; your software has no permission to send them.
How to authorise MTD software, or in the longer phrasing authorise software for Making Tax Digital, whichever product you choose:
- Open the product and find the HMRC or Making Tax Digital connection setting.
- Sign in with the Government Gateway details you use for Self Assessment, not a new account.
- Grant the software permission to interact with HMRC on your behalf.
- Check that your quarterly obligations and their due dates now appear in the product. An empty list means the handshake did not complete.
Two practical notes. Permissions expire, usually after 18 months, so at some point your software will ask you to authorise it again; this is routine rather than a fault. And if an accountant files for you, they authorise their own software against your record instead, which is why you never sign in. Our guide to signing up for Making Tax Digital covers the registration half.
How to use MTD software once it is connected
- Record income and expenses as they happen, or let a bank feed do it
- Review the categories before each quarter closes
- Check the summary the software has built
- Submit, and keep the confirmation
- Repeat four times, then finalise the year and file the return by 31 January
Nothing in that list is difficult. It simply has to happen five times a year rather than once, which is the real change MTD brings.
MTD software downloads, Mac and mobile apps
MTD software download: rare. Recognised products are nearly all cloud-based now, which means a browser login rather than an installer. Bridging tools are the exception, since several run as Excel add-ins.
Making Tax Digital software for Mac: rarely an issue. Cloud products are operating-system agnostic, so a Mac works exactly like a PC, and any MTD software for Mac question usually comes down to the desktop add-in bridging tools, some of which are Windows-only.
Making Tax Digital app options: most major providers have one. Apps for Making Tax Digital are useful for photographing receipts on site, less so for the quarterly review, which is easier on a full screen.
Cost, free options and the best products
Three questions always follow, and each has its own page rather than a paragraph here.
What it costs. Sole trader and landlord plans typically run from a few pounds a month to around £15, with higher tiers for limited companies and multi-user access. Bridging tools are usually cheaper, sometimes a one-off annual fee. Our breakdown of Making Tax Digital software cost sets out current pricing.
Free options. Genuinely free recognised products exist, and some are free only for basic use or for a limited period, which is worth checking before you commit a year of records to one. See our guide to free Making Tax Digital software.
Which is best. No single winner exists, because the right pick follows your working habits rather than a feature count. Our comparison of the best software for MTD sets the main options against each other.
Whichever you pick, remember that MTD software providers, HMRC MTD software providers, MTD software suppliers and making tax digital suppliers are all commercial businesses selling to you; HMRC is not recommending any of them. MTD approved software providers, as the marketing usually puts it, start from the same technical baseline.
If you would rather not run software at all
Plenty of people read this far and conclude they do not want to learn an accounting package to satisfy a filing rule. That is a legitimate answer, not a failure.
MTDFix works as your HMRC agent: we keep the digital records from your paperwork, file every quarterly update from our own recognised software, and finish the year with your tax return. You never choose a product, never authorise anything, and never see the software.
Filed for you, software included
£15 a month
- Recognised software, set up and run by us
- Digital records from your paperwork
- Four quarterly updates filed
- Year-end tax return
Running your own software
Keep control
- Pick from HMRC’s list
- Authorise it yourself
- File five times a year
- Ask us only when something breaks
Not sure which suits you? Talk to a Making Tax Digital accountant at MTDFix.
Skip the software decision entirely
Tell us what you run and how you keep records now. We will say whether software is worth it for you, or file it all from ours at a fixed monthly price.
📞 0116 403 0595 | 📧 mtdfix@yahoo.com | 🌐 mtdfix.com
MTDFix, 6 Egginton Street, Leicester, LE5 5BA · Working with clients UK-wide
FAQs
Does HMRC supply its own Making Tax Digital software?
No. HMRC publishes the list of recognised products and nothing else. Every option you can file with is commercial, whether free or paid.
Can I find software for Making Tax Digital that handles VAT and Income Tax together?
Yes, most full accounting packages do. Check the Income Tax list specifically, because VAT recognition alone does not prove the product can send quarterly updates.
Is a spreadsheet enough on its own?
For record keeping, yes. For filing, no. A spreadsheet has to be paired with bridging software, and the figures must pass between them digitally rather than being retyped.
What happens if my provider drops off HMRC’s list?
You would need to move before your next submission, which is why the live list is worth a glance each year. Recognition is withdrawn rarely, but products are discontinued more often.
Can I switch software partway through the tax year?
Yes. Authorise the new product, make sure your records move across in full, and check that previously submitted quarters still show correctly before the next deadline.
Do I need separate software for each business I run?
Rarely. Most products cover several trades and properties inside one account and report each of them separately, which beats juggling two logins and two subscriptions.
My accountant files for me. Do I still pay for software?
Not if they file from their own. Check what their fee covers before buying anything yourself, since our fee, for example, includes it.
The practical takeaway
The software decision is smaller than it looks. Confirm the product is on HMRC’s current list for the tax you file, pick the camp that matches how you already work, authorise it properly, then get on with the quarterly rhythm. Features beyond that are conveniences you are buying for yourself, not compliance you owe HMRC.
And if none of it appeals, remember the fourth option: let someone else file from software you never have to open.
Written for the 2026/27 tax year. General guidance on software choice, not a recommendation of any product or advice for your own circumstances. Always check HMRC’s current list before buying.
Sources
- HMRC guidance on choosing software for Making Tax Digital for Income Tax (GOV.UK)
- HMRC guidance on signing up for Making Tax Digital for Income Tax (GOV.UK)
- HMRC VAT Notice 700/22 on digital records and returns (GOV.UK)
- HMRC software finder tool for Making Tax Digital for Income Tax (GOV.UK)
- Number of recognised Income Tax products listed in early 2026 (Wikipedia, citing HMRC)