Updated on 6 April 2026

Choosing Making Tax Digital software

Making Tax Digital for Income Tax will require taxpayers to maintain their business records digitally using compatible software. This page explains the requirements and includes information on factors taxpayers should consider when choosing software. 

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Making Tax Digital software requirements

Anyone who is required to use Making Tax Digital will have to use third-party commercial software to allow them to meet the requirements of the new rules. The software will need to be able to:

  HMRC are not producing their own software to enable you to create digital records or file quarterly updates. Also, HMRC’s existing online filing service for self assessment tax returns will not be available for those within Making Tax Digital when they need to file an end of year tax return. 

As there is no software available from HMRC, it will be necessary to use a commercial software product in order to meet the Making Tax Digital requirements. 

The software you choose must be Making Tax Digital compliant. This means that it can successfully and securely connect to and integrate with HMRC’s systems. Not all software products will be able to meet the needs of every taxpayer, so it’s important to understand your requirements and find a product that is suitable based on your own circumstances and budget. It may be that you will have to use more than one software product if you have more complicated circumstances. 

The cost of the software packages varies between suppliers. There are some free products from commercial suppliers on the market. But note that free products may also be subject to specific limitations, such as that the product may only be free for a limited time or may only be for the simplest version of a software developer’s product. Therefore, you should take care when reviewing potential software products to try to ensure you get the most suitable product for your circumstances.

Types of software

Accounting or bookkeeping software

These are software packages which allow you to create and maintain digital records. The features will vary depending on the software provider but many of the packages available are able to link to your bank account, allowing information to be downloaded from the bank account directly into the software. This allows income and expenses to then be allocated to the various income and expenses categories automatically by the software (however, these entries should be reviewed and reconciled to ensure the digital records are accurate). 

Some software providers may also provide an app, meaning you can create your digital records on the go (for example, by scanning receipts). 

Bridging software

This type of software cannot create digital records on its own. It can however connect to existing records, such as spreadsheets. Bridging software will enable those using spreadsheets for record-keeping to link to HMRC’s computer systems and submit the required quarterly update information. Bridging software is likely to be suitable for those with less complicated affairs or those who currently maintain their records on a spreadsheet and would prefer to continue doing so. 

HMRC’s software choices tool

HMRC do not recommend any specific software providers, however, they have developed a tool to help you choose Making Tax Digital compliant software that is suitable for your needs. The tool will ask you a series of basic questions and will then produce a list of software that may meet your requirements. 

The list can then be filtered for things like accessibility features and whether the software is paid or free. It will be up to you to determine what product (or products) best suits your needs. The tool shows you both what is available now and what products are in development. You should always check the software provider’s website for full details before committing to a particular software product. Our checklist below provides examples of some of the points you may wish to consider, or questions you might want to ask, when choosing a software product. 

If you are VAT registered

If you are VAT registered and are already using software that meets the requirements of Making Tax Digital for VAT, you need to consider how you will also meet the Making Tax Digital for Income Tax requirements. You could check with your current provider to see whether their software will also be suitable for Making Tax Digital for Income Tax. If not, then you may need to look around for a different product which will cover both requirements, assuming you don’t want to keep two sets of records on two different pieces of software (it is not a requirement that you have separate packages for income tax and VAT).

It is possible to change your VAT quarters to align with Making Tax Digital for Income Tax quarterly update periods, if you wish to do so for convenience, although this is not compulsory. 

Changing software

You may find that you want to change your software if it no longer meets your needs or if your circumstances change. It is worth bearing in mind that the old and new software products may not be compatible if they do not store data in the same way. It could therefore be difficult to transfer data from one product to another. It may be preferable to wait until the end of a tax year, if possible, before changing software providers. 

As you are required to maintain business records for at least five years from the 31 January following the end of the tax year, you will need the ability to extract your business records if you are changing software providers. You should ensure there is a way to download and store your data, for example, on an external hard drive. For some software providers, the ability to access your data may rely on paying an ongoing subscription fee. 

Making Tax Digital software checklist

Making Tax Digital software checklist by LITRG

Making Tax Digital software checklist by LITRG
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Download a copy of our checklist here

Frequently asked questions

Will HMRC provide free software for Making Tax Digital?

No, HMRC will not be providing any Making Tax Digital software at all. You will have to source third-party software which has been approved for Making Tax Digital. You can use HMRC’s software choices tool to help you find compatible software. HMRC will not be able to recommend a specific software product. 

You will not be able to use HMRC’s online filing service to prepare and submit your end of year tax return for any tax years where you are within Making Tax Digital, so from 2026/27 onwards for those joining from April 2026. If you are mandated to join Making Tax Digital from April 2026, you will still need to submit your 2025/26 tax return – which is due by 31 January 2027 – under the self assessment system. You can read more about this on our page How do I do my end of year tax return under Making Tax Digital?.

Will there be free software available?

Yes, some software providers offer a free version of their product, however, these may only be suitable if you have straightforward tax affairs. HMRC’s software choices tool outlines the various products available and includes details of their functionality. You can filter for free software products. Watch out for “free” software products that come with conditions. For example, time-limited free trials that may result in charges when the trial ends, or offers that are only free for customers of certain banks. It’s important to check the terms and conditions carefully before signing up to any software product.  

Can I still use a spreadsheet to track my income and expenses?

Yes, you can use a spreadsheet, but this on its own will not be enough. The spreadsheets must be linked to compatible software so you can send your quarterly updates. This is called a digital link and allows you to send the figures on your spreadsheet to HMRC without you having to type them again. You will need a special type of software called bridging software to be able to do this.

I have self-employment and property income - will I need multiple pieces of software?

If you have income from self-employment and from property, you have to submit quarterly updates for each source of income. There may be software products available that can deal with both sources, but you will potentially need to pay for more than one license. This is because there may be a limit on the number of businesses that one licence to use the software may cover. 

Some products only allow one software licence to cover one business, in which case you would need one licence for the self-employment record-keeping, quarterly updates etc and another separate licence for the property income record-keeping, quarterly updates etc. Therefore you have to pay an additional amount for the extra licence. HMRC’s software choices tool outlines the various products available and you can filter for your sources of income to help you find a suitable product. 

My internet is not reliable – will this prevent me from using software?

You will need a reliable broadband connection to be able to run most software products and to submit your quarterly updates to HMRC. If you do not have a reliable internet connection at home and are not able to access the internet elsewhere, you can consider applying for an exemption on the basis of being digitally excluded. 

I use a screen reader – will there be software available for me?

Many software providers offer, or plan to offer, software with accessibility features, for example, if you are blind or have impaired vision (although you may be exempt if you claim blind person’s allowance) . HMRC’s software choices tool allows you to filter for accessibility features. You should also confirm with any potential software provider before committing to a software product for Making Tax Digital. 

Will the cost of software be tax deductible?

Yes, HMRC have confirmed that the cost of purchasing software will be tax deductible as a business expense on the basis that it is ‘wholly and exclusively’ used for business purposes. 

What support is available?

The level of customer support available will depend on the software provider you choose. Many providers will have their own customer support teams, but how the support is offered (for instance telephone support and support by email) may vary between providers. This is something that you should take into consideration when choosing a provider. HMRC will not be able to help with software specific queries. However, HMRC can answer general queries about Making Tax Digital via the self assessment helpline. 

Are there any benefits to using software?

There are many potential benefits of using software. HMRC say that digital record keeping may reduce the potential for errors in your return. You might find that using software will allow you to streamline your record keeping – rather than having invoices and receipts in different places – which should reduce the risk of you losing any important documents. If your software has the ability to do so, linking to your bank can also save you time when collating information. Some software will be able to send reminders, meaning you are less likely to miss filing deadlines. Certain software products may also be able to provide helpful prompts or nudges to flag up possible errors or highlight where reliefs or allowances might be available. 

However, we recognise that using software will also place an administrative burden on some individuals and might feel overwhelming. See our getting help page for more information. 

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