Transition from Self Assessment to Making Tax Digital
My aim is to make your transition from Self Assessment to Making Tax Digital as smooth and painless as possible. Minimum cost. Minimum upheaval.
If you’re happy using spreadsheets, and your spreadsheets contain the information HMRC needs, you don’t need to use bookkeeping software to comply with Making Tax Digital. All you need is bridging software, which enables you to submit the figures directly from your spreadsheets to HMRC.
For the last 10 months, I’ve been a participant in the Thomson Reuters Digita Making Tax Digital pilot. I signed up for Making Tax Digital early and have been using Digita’s bridging software feature to submit my quarterly figures to HMRC for the whole of 2025-26. I then did my annual submission, confirming that the four quarters were correct and making any end of year adjustments – and my end of year declaration, which is the Making Tax Digital equivalent of a Self Assessment Tax Return.
One of my aims in signing up to the trial, was to test how easy it would be to continue to use spreadsheets once Making Tax Digital went live. The answer is, it’s really easy.
The first quarter takes a bit of time to set up. You have to create a “map”, to tell the bridging software which boxes in your spreadsheet belong in which category on your Tax Return. After that, it’s plain sailing.
I also trialled using bookkeeping software that couldn’t (yet) handle the MTD submissions itself, but which could export a trial balance in an MTD-compatible format. It worked exactly the same way. If a trial balance from non-MTD-compatible software can be exported in .csv or .xls format, you can use bridging software to submit the figures to HMRC.
This makes a huge difference. It means I haven’t got to tell my clients they can’t use spreadsheets anymore, or that they can’t use the software they like because it can’t do quarterly MTD updates. There’s a workaround using bridging software – and I know it works in practice because I’ve done it.
For more bookkeeping and tax tips, and support in the transition from Self Assessment to Making Tax Digital, follow Springreach Training & Coaching on social media or sign up to my mailing list. Link in the comments below.
[Image credit: Freepik on Magnific]