Do I Need an Accountant for Making Tax Digital?

Short answer: no, you don't need an accountant to comply with MTD. But there are situations where having one still makes sense.

Making Tax Digital for Income Tax changes how you report to HMRC, not what you report. If you've been doing your own Self Assessment tax return, you can probably handle MTD yourself — especially with the right software.

What MTD Actually Requires You to Do

Under MTD for Income Tax, you need to:

1. Keep digital records of your income and expenses (no more shoeboxes of receipts)
2. Submit quarterly updates to HMRC — four times a year, summarising your income and costs
3. Submit a Final Declaration after the tax year ends, confirming your overall tax position (this replaces the Self Assessment tax return)

That sounds like a lot, but the quarterly updates are simple summaries. You're not submitting detailed breakdowns — just totals for income and expenses by category.

What an Accountant Can and Can't Do Under MTD

Under MTD, your accountant can still do everything they did before — and more. Using HMRC's Agent Services Account, accountants can:

• Submit quarterly updates on your behalf — they connect to your HMRC record through agent authorisation and file using their own MTD software
• Submit your Final Declaration — the year-end confirmation that replaces your Self Assessment return
• Review and adjust your figures — apply reliefs, capital allowances, and optimise your tax position
• Handle correspondence with HMRC — respond to queries, manage penalties, deal with compliance checks

What they cannot do is keep your records for you in real time. MTD requires digital records to be maintained throughout the year, not compiled from a carrier bag of receipts in January. Even if your accountant handles submissions, someone needs to enter the income and expenses into software as they happen — and that someone is usually you.

This is the key change: under Self Assessment, you could hand everything to your accountant once a year. Under MTD, there is ongoing work throughout the year that either you or your accountant must do quarterly.

When You Can Do MTD Yourself

You can probably handle MTD without an accountant if:

• Your finances are straightforward — one income source, clear expenses, no complex tax reliefs
• You've been doing your own Self Assessment — MTD is actually simpler because you're spreading the work across the year
• You use MTD software — tools like ClearMTD guide you through each step and submit directly to HMRC
• You're comfortable with basic record keeping — if you can track what you earn and spend, you can do MTD

Most sole traders with a single trade and straightforward expenses will find MTD perfectly manageable on their own.

When an Accountant Still Makes Sense

Consider keeping your accountant if:

• You have multiple income sources — self-employment plus rental income, for example
• Your tax affairs are complex — capital allowances, losses brought forward, overlap relief
• You claim tax reliefs that require professional judgement
• You simply don't want to deal with it — that's a valid reason
• You're close to the VAT threshold — you may need advice on structuring

When you probably don't need an accountant

If your tax situation is simple, an accountant is an unnecessary expense:

• You have one self-employment income source (freelancer, sole trader, contractor)
• Your expenses are straightforward (no capital allowances, no stock, no vehicle claims beyond simplified expenses)
• You are comfortable keeping basic records of what you earn and spend
• You have been filing your own Self Assessment successfully

In these cases, MTD software handles everything HMRC requires. The quarterly updates are simpler than a Self Assessment return — you are just submitting income and expense totals.

Even if you use an accountant, MTD changes the workflow. Your accountant can't just do everything at year-end anymore — quarterly updates need to happen during the year. Many accountants are asking clients to use MTD software for the quarterly updates and then handling the year-end advisory work themselves.

The Middle Ground: Software + Year-End Accountant

The approach many sole traders are taking:

1. Use MTD software to keep records and submit quarterly updates yourself (this is the routine data entry — income and expenses)
2. Hand over to your accountant at year-end for the Final Declaration, where they can review your figures, apply reliefs, and optimise your tax position

This keeps costs down (you're not paying an accountant for basic data entry four times a year) while still getting professional help where it matters.

ClearMTD is built for this workflow. It's simple enough to use yourself for quarterly updates, and your accountant can review your records at year-end.

DIY vs Accountant: What Does It Actually Cost?

Here is a realistic cost comparison for a sole trader with straightforward finances:

The hybrid approach is where most cost-conscious sole traders land. You save hundreds per year by doing the routine quarterly data entry yourself, while still getting professional eyes on your year-end figures.

For context, the cheapest MTD software options start from free (with limitations) to around £15/month. ClearMTD sits at £7.50/month — designed specifically so you do not need an accountant for the routine parts.

Getting Started Without an Accountant

If you decide to do MTD yourself:

1. Check if MTD applies to you — use our free MTD checker to find out
2. Choose MTD software — you need HMRC-recognised software to submit quarterly updates
3. Sign up with HMRC — you'll need to register for MTD for Income Tax through your Government Gateway account
4. Start keeping digital records — your software will handle the format HMRC needs

The first quarterly update under MTD isn't due until July 2026 (for the April–June quarter). You have time to get set up.

Summary

MTD doesn't have to mean higher costs. With the right software, most sole traders can handle compliance themselves — and keep their accountant on hand for the bits that actually need professional expertise.

The Bottom Line

MTD does not require an accountant. It requires software, digital records, and quarterly submissions. If your finances are straightforward, you can handle all of this yourself for a fraction of what an accountant charges.

If your finances are complex, keep your accountant — but consider the hybrid approach to reduce costs. Either way, check if MTD applies to you and get set up before your first deadline.

Start your free ClearMTD account and see how simple quarterly submissions can be.

Further Reading

• Making Tax Digital for sole traders: complete guide — everything you need to know
• Your first MTD quarterly update: step-by-step — what the process actually looks like
• MTD for landlords 2026 — landlord-specific guidance
• Best MTD software for sole traders — compare the options
• What expenses can you claim under MTD? — full expense guide