Coming in 2024: Making Tax Digital for Income Tax and Self-Assessment (MTD for ITSA)

Big changes are on the horizon.

After a series of delays (classic HMRC!), the rollout of Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) is finally happening just not as originally planned. While the delay announced at the end of 2022 was frustrating for professionals like myself working hard to prepare clients, it’s now full steam ahead.

I’ll be releasing a new blog post and infographic soon to help you get to grips with the changes.

So, What’s Changing?

From 6th April 2024, if your total self-employed income (not profit) exceeds £10,000, you’ll need to comply with the new MTD for ITSA rules.

In simple terms:
The days of filing a single self-assessment tax return each January are over.

What Will You Need to Do?

Starting from the 2024/25 tax year, here’s what HMRC will require for each business you run:

Quarterly Updates:
Submit income and expense reports every 3 months.
📅 First deadline: 5th August 2024
⏳ You’ll have one month after each quarter ends to submit.
Annual End of Period Statement (EOPS):
Summarises your business income and expenses.
📅 Due by 31st January 2026 (for the 2024/25 tax year).
Final Declaration (Crystallisation):
This ties everything together—including PAYE income and dividends.
📅 Also due by 31st January 2026.

How Will You Submit All This?

You’ll need to keep digital records and use compatible accounting software to send updates to HMRC.

Some of the most user-friendly and HMRC-compliant options include:

✅ Xero
✅ QuickBooks
✅ FreeAgent
✅ Sage

These platforms allow you to:

Link your bank accounts for automatic transaction tracking
Store invoices and receipts digitally (no more cluttered drawers!)
Give your accountant or bookkeeper access for seamless support
Use reporting tools that help you understand and grow your business

Still using spreadsheets?
You can continue with spreadsheets, but you’ll need “bridging software” to submit your data to HMRC. While this might avoid monthly subscriptions, it comes with its own set of drawbacks like manual calculations, submission risks, and still having to manage your paperwork carefully.

Bonus: Many accountants and bookkeepers (like myself) can offer discounted software subscriptions just ask!

It’s Not All Bad News

MTD for ITSA may sound overwhelming at first, but once you’re set up, it’s actually very manageable. If your records are kept up to date, it’ll just be a few extra clicks every quarter.

Still feeling the stress? You’re not alone and you didn’t start your business to spend hours on tax returns! That’s where a bookkeeper can help. We’ll ensure you stay compliant, avoid penalties, and free up your time so you can focus on what you love. Many of us also offer advisory services to help you grow your business.