MTD compatible software for tradespeople: the best options in 2026

From April 2026, Making Tax Digital for Income Tax (MTD IT) starts for self-employed individuals earning over £50,000. You will need to maintain digital records and submit quarterly updates to HMRC. Traditional paper records or manual spreadsheets will no longer suffice.

This article explains what MTD software means for tradespeople, key considerations when selecting software, and the leading options available today.

What MTD for Income Tax requires

Starting 6 April 2026, if you're self-employed or a landlord with income over £50,000, you must:

• Keep digital records of income and expenses
• Submit quarterly updates to HMRC (four times a year, within one month after the quarter ends)
• Provide an End of Period Statement (EOPS) to confirm the yearly figures
• Submit a Final Declaration to finalise your tax bill, replacing the annual self-assessment return

The quarterly updates are summaries, not full returns. These don’t need to match your final figures precisely, as you can adjust in the EOPS. Timely submission is essential to avoid penalties.

From April 2027, the threshold reduces to £30,000, and from April 2028, it applies to income over £20,000.

What good MTD software looks like for a tradesperson

Not all MTD software is suitable for tradespeople. Some are overly complex if you need to quickly log a receipt between jobs. Here's what you should focus on:

HMRC recognition

Only select software listed on HMRC's official MTD for Income Tax compatible software list. This ensures the quarterly submission feature works correctly and that HMRC accepts your returns.

Mobile-first design

Unreliable signal on job sites makes offline-capable software that syncs when reconnected far more useful than browser-only tools. An app that allows quick receipt logging is more likely to be used than one needing desktop access.

Invoicing built in

For tradespeople, invoicing and record-keeping often go hand in hand. Software combining invoicing, expense tracking, and MTD submissions in one app removes the need for data transfers between systems. Tools focused on tradespeople usually prioritise this integration.

VAT support

Many tradespeople are VAT-registered. Your software should manage VAT calculations, CIS deductions, and the domestic reverse charge accurately. It should also support MTD for VAT if you're not already compliant.

CIS support

For those in construction with CIS deductions, your software should manage CIS subcontractor records and automatically reconcile deductions with your tax return.

MTD software options for UK tradespeople

InvoiceAdept

Designed specifically for UK sole traders and tradespeople, InvoiceAdept combines invoicing, expense tracking, CIS management, and MTD quarterly submissions in one mobile app. It handles VAT, the domestic reverse charge, and prepares your quarterly updates automatically. No accounting experience is needed. A free plan is available for lower volume users.

QuickBooks Self-Employed / QuickBooks Sole Trader

QuickBooks offers a mobile app with effective receipt capture and mileage tracking. The MTD for Income Tax module is available on higher-tier plans. Ideal for tradespeople already using QuickBooks for bookkeeping who wish to maintain continuity. Starts at around £10/month.

FreeAgent

A favourite among freelancers and sole traders. It provides strong MTD support, a clean interface, and a reliable mobile app. Free to use if you bank with NatWest, Royal Bank of Scotland, or Ulster Bank. Otherwise, it costs around £19/month for sole traders.

Xero

Xero leads the UK market for small business accounting. MTD for Income Tax is integrated. It offers more features than many tradespeople require, and its mobile app isn't as refined as some others. Prices start at £16/month, but MTD IT requires higher-tier plans.

Sole Cloud

A newer platform focused on MTD, tailored for sole traders. Simpler than Xero or QuickBooks, it features a straightforward quarterly submission workflow. Consider it if you need a lightweight tool for MTD IT without extra features.

Spreadsheets with bridging software

Using Excel or Google Sheets for records? "Bridging software" can transfer data to HMRC in an MTD-compliant format. This is allowed but adds complexity and is only suitable if your spreadsheet is well-maintained. It's not the best long-term solution for most tradespeople.

How to choose

For most tradespeople, the ideal software should:

1. Be on HMRC's approved list
2. Have a mobile app that works offline
3. Include invoicing to avoid managing two systems
4. Handle CIS and VAT correctly for your trade
5. Cost less than what it saves in accountant fees

Try a few options on a free trial before the April 2026 deadline. It's far less stressful to choose software in advance and get comfortable with it than to rush in early April.

When do you need to start?

If your income exceeds £50,000 in the 2025/26 tax year (ending 5 April 2026), you'll need to comply with MTD IT from 6 April 2026. Your first quarterly update covers April to June 2026, due by 5 August 2026. Ensure your software is set up and linked to HMRC before then.

HMRC will inform businesses that should join MTD IT, but don't rely on receiving a letter. Check your income and register if you qualify.

Useful resources

Our guide on Making Tax Digital for sole traders in 2026 covers the full MTD IT process from start to finish. Our self-assessment calculator can help you estimate if your income will exceed the £50,000 threshold this year.