From April 2026 Making Tax Digital for Income Tax (MTD for IT) will apply to self-employed individuals and property landlords whose gross annual income is £50,000 or more. Individuals who earn between £30,000 and £50,000 will be required to join the scheme from 2027.
Download our FREE MTD for IT guide, featuring the latest updates from HMRC
The MTD software market continues to be riddled with misinformation about the use of spreadsheets and complying with MTD. Our Bridging Software Factsheet sets out everything you need to know about MTD for Income Tax and MTD for VAT, along with the software options available to you. And yes, Bridging Software is a long term option.
Bridging Software – we need to set the record straight! The accounting software industry and, indeed, some members of the accountancy profession are dismissing the use of bridging software for Making Tax Digital (MTD). Find out why they are wrong!
Bridging software is a valid solution for MTD compliance
We regularly hear from prospective users that they have heard that HMRC will stop accepting bridging software in the future. Interestingly, it is usually what they have been told when speaking to larger accounting software suppliers! It was particularly prevalent during the rollout of MTD for VAT and is already being mentioned in the context of MTD for Income Tax (IT).
We want to highlight the fact that VAT registered businesses and those who will be caught under MTD for IT do not have to use “complicated and expensive” software in order to comply with MTD.
HMRC’s view
The HMRC repeatedly mention the use of MTD compatible bridging software and how it is a practical option for meeting the requirements of MTD – https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax#what-software-to-use
They have updated all documentation to confirm that it will be a viable option for the long term future.
Bluntly speaking, it would be incredibly naïve of HMRC to think that landlords and low income self-employed people would be happy to sign up to onerous, complicated and expensive accounting and tax return software in order to comply with MTD.
MTD compliance does not have to be expensive or complicated
Much has been written about businesses having to use expensive and complicated accounting MTD compatible software. However, the aim of any bridging software product is to make the digital filing of both VAT and income tax returns as quick and simple as possible.
Absolute has achieved this (our customers are constantly telling us so!) and our Excel VAT Filer (EVF) bridging software is one of the easiest and most cost effective pieces of bridging software on the market. Our happy users range from small accountancy practices as well as “one man bands” to multinational businesses who use EVF. In some cases the latter have their own bespoke VAT software but use EVF to digitally link their VAT information to HMRC and comply with HMRC MTD requirements to the end.
Purchased by businesses and agents, the simplicity of the product has resulted in it being chosen by over 17,000 users who have so far filed over 1,000,000 VAT returns (figures as of June 2024).
Creating a simple product that costs just £40+VAT for a 12 month licence and can be used for up to 10 traders is why we receive such glowing testimonials from our users. On top of that, EVF users receive free and unlimited email technical support, and the software includes a built in ‘Knowledge Base’ function which tells you how to fix rejected VAT returns. There is also a client portal which enables you to check and reprint previous VAT submissions, as well managing your EVF licences ahead of their expiry dates.
Plus, unlike other software providers who offered free MTD software and then significantly increased the price at the first renewal, our software has been £40+VAT since we launched it in 2019 and we have no plans to change this price point.
Making MTD for VAT compliance simpler
Many VAT registered businesses have already subscribed to end-to-end accounting software in order to comply with the regulations. We have spoken to many such businesses who have experienced ‘buyers’ remorse’ having been sold overly complicated and costly accounting packages. They have now moved to using our EVF bridging software, which they find provides a simple and inexpensive way to comply with MTD.
The message is, it’s never too late to change and you could save yourself a lot of money, time and effort by making that change to our EVF bridging software.
MTD for IT bridging software
On the strength of the success of our EVF software, we are working with HMRC’s updated criteria to develop similar bridging software for MTD for IT. As with the EVF, our aim is to create a product which is:
More information and register your interest
Further details, including how to purchase our Excel VAT Filer bridging software can be found here.
If you would like to be added to our mailing list to receive further information about our MTD ITSA Filer software, please email Dave Frost at Absolute at dave@absolutetax.co.uk.
And of course, if you have any questions about MTD and the validity of bridging software for VAT or Income Tax purposes, please do get in touch at sales@absolutetax.co.uk.
MTD for Income Tax is replacing the current Income Tax Self Assessment process. It affects self-employed people and landlords with an annual income of over £50,000 and is being phased in from April 2026.
This new tax system requires taxpayers to digitally file quarterly income and expenses, along with an annual summary and final declaration that all sources of income have been confirmed.
Absolute Accounting Software Limited Company Number 07122547 (Registered in England & Wales)
Registered Office: Bicester Innovation Centre, Telford Road, Bicester, OX26 4LD
