A Making Tax Digital readiness plan for a practice

The three groups

Working out each client's group

HMRC checks each client's Self Assessment return every tax year and writes when qualifying income is over the threshold. The table follows that guidance. A client's group comes from the return for the year HMRC checks. A client under £50,000 on the 2024 to 2025 return can still join in April 2027 if the 2025 to 2026 return is over £30,000.

Qualifying income is gross self-employment and property income before expenses. HMRC's planning chapter of the agent toolkit lists the boxes to add: SA103F boxes 15 and 16, SA103S boxes 9 and 10, SA200 boxes 3.6 and 6.1, SA105 boxes 5, 20, 22 and 23, and SA106 boxes 14 and 16. Only the client's share of jointly owned property counts (HMRC: qualifying income). The guide for agents lists what is left out.

For example, a client whose 2025 to 2026 return shows £18,000 of turnover on SA103S box 9 and £14,000 of rent on SA105 box 20 has qualifying income of £32,000 and joins on 6 April 2027.

The plan for each group

1. List the income sources

   Record each self-employment business, any UK property business and any foreign property business. HMRC's toolkit notes that each separate business needs its own quarterly update.

2. Check exemptions

   Mark clients who are exempt automatically and those who need to apply, such as the digitally excluded. See exemptions and digital exclusion.

3. Record how each client keeps books

   The toolkit asks agents to note current software, paper records, internet access, technical confidence and any experience of Making Tax Digital for VAT.

4. Confirm who does what

   Note any bookkeeper or second agent and agree which practice is main agent and which is supporting agent. See agent roles.

5. Check authorisations

   Make sure each Self Assessment authorisation appears in the agent services account, or ask the client to authorise you through it (HMRC: sign up your client).

6. Choose software

   Pick software for record keeping, bridging or both, and authorise it through the agent services account. HMRC's practice chapter says the authorisation must be renewed every 18 months.

7. Sign the client up

   Sign up with the client's full name, date of birth, National Insurance number and details of each business (HMRC: sign up your client).

Records each group needs

Each digital record shows the amount, the date and the category, and records must be made before the quarterly update is sent or the deadline passes, whichever is first (HMRC: create digital records). A client with turnover under £90,000 can use simpler categories. Once turnover reaches £90,000, every record for that income source must be categorised in full from the start of the tax year.

Paper records, shoeboxes of receipts and spreadsheets without links to submission software all need a change of method before the start date. The free record sheet is one spreadsheet layout a client can keep.

A client letter timetable for the April 2027 group

When the 2025 to 2026 return is filed

Tell the client their qualifying income and whether they join on 6 April 2027 (HMRC: find out if and when).

Before 6 April 2027

Agree software, record keeping and who sends updates, then sign the client up.

April 2027

Records start for 2027 to 2028.

7 August 2027

First quarterly update due (HMRC: quarterly updates).

From the first update

Penalty points apply to late quarterly updates for tax years after 2026 to 2027 (HMRC: penalties).

31 January 2029

Tax return for 2027 to 2028 due through the software.

Registration as a tax adviser

HMRC's mandatory tax adviser registration, with an online service opened on 18 May 2026, requires anyone paid to deal with HMRC for clients to register through an agent services account. Registration windows differ by type of adviser, and HMRC's registration guidance gives each one. An adviser who misses the window may be unable to act for clients with HMRC.

Questions