Starting in April 2024, Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA) changes will require taxpayers with business or property income over £10,000 to:
- keep digital records;
- report their taxes quarterly to HMRC (instead of only once a year);
- file a final end of year submission
If you’re an accountant or bookkeeper, it will no longer be possible for you (or the taxpayer) to file self assessment returns directly to HMRC via the gov.uk website. HMRC will not be providing this software to accountants. You’ll need to use software that is recognised by HMRC for Making Tax Digital for Income Tax Self Assessment.
Read everything you need to know about MTD in our guide for accountants here
What is the best software for Making Tax Digital for Income Tax?
We could just say untied (of course) and be done with it.
But we know there can be a few different platforms to choose from, so we’ve put together some top tips and a checklist that bookkeepers and accountants can use when selecting the right solution.
How do I choose the best software for Making Tax Digital?
This next phase of MTD will impact more taxpayers than any of the previous MTD phases, so the key here is to think about software that works for both you and for your clients, and to get ready well ahead of time.
Software for you
We recognise that many practices already use software, from providers such as IRIS, LexisNexis, Wolters Kluwer and Thomson Reuters.
If you like the platform, then as part of onboarding your practice with untied, we will discuss the options to integrate with your existing platform using our powerful APIs (application programming interfaces) that can ‘speak’ to these other systems.
But if you’re looking for something better, untied has an easy-to-use interface for you to manage your personal tax clients. It includes the ability for you to work on their accounts, and to communicate with them about any queries. Documents can also be embedded.
Software for your clients
Your clients will undoubtedly have different needs. Larger sole traders with ring-fenced trading activities and partnerships may find that Xero and QuickBooks are the right product for them to draw up their accounts for the business.
However, you’ll still want software to bring in the rest of their income sources – did you know you can grab the numbers for their trading income from Xero, and then upload them in untied to manage all the other income sources (and even point out what’s missing from one year to the next).
If someone has turnover below £85,000 or is a property landlord, then we challenge you to find better end-to-end software than untied. We designed untied from the bottom up with continuous feedback from our users.
untied is set up for your clients to use from their phone or desktop. They just link their accounts, and you can do the rest. If you want to save more time, or you’ve got some clients who want to take more control, then they can do so too, up to the point that they click “submit to adviser”.
The core difference is that software such as Xero and QuickBooks have traditionally been built on a double-entry basis. In contrast, untied does not need double entry. We have designed it to be a tool for your practice to support taxpayers who make up the bulk of the MTD ITSA population.
Our software is built to reflect how people live their lives (and work their lives) today with income sources and bank accounts all intermingled.
How does untied stand out?
untied is built first and foremost to be a next-generation personal tax platform for end users and their advisers. We worked closely with both accountants and their clients to design untied and we are constantly making improvements based on their suggestions. Everything is built around their needs.
We were also the first end to end app recognised by HMRC for Making Tax Digital for Income Tax.
Multiple data sources
untied integrates into multiple data sources – including pulling data from HMRC about your clients. Using secure and trusted Open Banking technology, bank account data can be the simplest way to gather the data needed.
However, if you have prepared information outside of untied, it can easily be added as a manual transaction or uploaded via a comma separated value (CSV) file. Don’t worry, we make it as easy as possible for both you and your clients.
Do I need to wait for MTD ITSA before using untied with my clients?
No. Lots of accountants are using untied with their clients today, helping them get used to keeping digital records, so the transition to MTD is smooth.
We guarantee that you’ll find untied quicker and easier than current self-assessment processes, setting you and your clients up for the migration to MTD ITSA when you’re ready.
Does the software support multiple income streams and other forms in the self assessment?
It's important to ensure that you can use the same software for everything on the self assessment. untied supports multiple income sources, and other requirements including:
- Employment income
- Property income (including FHL furnished holiday lets)
- Self-employment (trading) income
- Pension income
- Investment income
- Capital gains
- Residency forms including for non-resident landlords
What support will be provided?
Advisers that sign up to untied are supported with a full project managed service that includes:
- A return on investment calculation for your practice
- A project plan for implementation
- Integration with your existing system
- Internal communication to your team
- Templated client communications
- Internal training awayday
- Client training
- Onboarding with HMRC
- Migration timetable
- Migration to MTD ITSA
- A personalised landing page on untied’s website
- Five-star ongoing support for you and your client
Can you migrate existing clients to new software?
You want to be able to move your clients seamlessly to new software. untied can help migrate your clients, including a managed bulk migration option.
As we said at the start, the best software for MTD ITSA is one that works for you and for your clients.
We've highlighted the key questions that accountants and bookkeepers should be asking any software provider, and hopefully shown you some of the benefits of using untied. We've also summarised these in a printable guide at the bottom of this page.
We know this is a big decision, and this (maybe slightly biased) article probably isn't enough on its own to convince you.
The next step would be to arrange a live demo of our adviser portal and user app, and talk to one of our friendly team. Click on the link below to set up a time to chat with us.
Stay up to date on Making Tax Digital
We’re posting regular updates as we move closer towards full MTD ITSA adoption.
Don’t miss any updates by signing up to receive our MTD newsletter or register for our MTD early adopter program. We hope you will join us on this journey!
As always, untied is here to help you at every step, so please don’t hesitate to contact us if you have any questions.
Print our MTD software checklist