Choosing MTD-Compatible Software

Key facts

MTD software must be HMRC-recognised and able to connect to HMRC via APIs.
HMRC publishes lists of compatible software for VAT and Income Tax.
You can use a single application or combine bridging software with spreadsheets, provided digital links are maintained.
Key features to look for include VAT and ITSA support, digital record-keeping, quarterly submission, and HMRC filing.
GoFile is an HMRC-recognised MTD-compatible software provider for both VAT and Income Tax.

Why You Need MTD-Compatible Software

Under Making Tax Digital, you cannot submit tax returns through the HMRC website as before. Instead, you must use software that connects directly to HMRC’s systems via Application Programming Interfaces (APIs). This software must be on HMRC’s list of recognised providers.^[3]

MTD-compatible software serves two purposes:

Digital record-keeping — maintaining your income, expenses, and VAT records in a digital format
Digital filing — submitting your VAT returns, quarterly updates, or final declarations directly to HMRC

Types of MTD Software

There are broadly three approaches to MTD compliance:^[4]

Approach	How It Works	Best For
End-to-end software	A single application handles record-keeping, calculations, and filing to HMRC.	Most businesses — simplest and least error-prone approach.
Bridging software + spreadsheets	You keep records in spreadsheets; bridging software reads the data and files it to HMRC.	Businesses with established spreadsheet systems they want to keep.
Linked software	Multiple software packages connected by digital links — e.g. one for record-keeping and another for filing.	Larger businesses with specialist systems (e.g. ERP + filing tool).

Important: Whichever approach you choose, all data transfers between software must be via digital links. Manual re-keying or copy-and-paste is not permitted under MTD. See Digital Links & Digital Records for details.

What to Look for in MTD Software

When choosing MTD-compatible software, consider these key factors:

HMRC recognition — check the software appears on HMRC’s official lists for VAT and/or Income Tax^[1]
Tax coverage — does it support the taxes you need? (VAT, Income Tax, or both)
Digital record-keeping — can you record income, expenses, and transactions within the software?
Quarterly updates & final declarations — for ITSA, does it support the new quarterly submission cycle?
Ease of use — is the interface clear and straightforward? You will use it throughout the year
Cost — does the pricing work for your business? Look for free trials to test before committing
Support — is UK-based support available if you get stuck?
Integration — does it integrate with your bank, payment provider, or existing accounting software?

Checking HMRC’s Software Lists

HMRC maintains separate lists of compatible software for each MTD tax:^[1]^[2]

Tax	HMRC Software List
MTD for VAT	GOV.UK: MTD for VAT software
MTD for Income Tax	GOV.UK: MTD for Income Tax software

Only use software from these lists. If your software is not listed, it has not been recognised by HMRC and you may not be compliant.

GoFile: MTD-Compatible Software

GoFile is an HMRC-recognised MTD-compatible software provider, designed specifically for UK businesses and individuals. GoFile supports:

MTD for VAT — file your VAT returns directly to HMRC
MTD for Income Tax — submit quarterly updates and final declarations
Self Assessment — file SA100 and supplementary pages
Digital record-keeping — track income and expenses in one place

GoFile has helped over 50,000 UK businesses file tax returns. You can try it free — no credit card required.

Tip: Start using MTD software before the mandate date. This gives you time to learn the system, set up your records, and resolve any issues before your first compulsory quarterly update is due.

Switching Software

If you already use MTD software but want to switch, here are some practical considerations:

Export your data — download your transaction history and records from your current provider
Reauthorise with HMRC — when you set up new software, you will need to grant it access to your HMRC account
Check submission history — HMRC keeps a record of your previous MTD submissions, so there is no risk of losing them
Switch at a natural break — if possible, switch at the start of a VAT period or quarterly update period

Frequently Asked Questions

How do I know if software is MTD-compatible?

HMRC publishes lists of recognised MTD-compatible software on GOV.UK. Any software on these lists has been tested and approved to connect with HMRC’s MTD systems. GoFile appears on both the VAT and Income Tax lists.

Can I use spreadsheets for MTD?

You can use spreadsheets for record-keeping, but you will need “bridging software” to submit the data to HMRC. All data transfers between your spreadsheet and the bridging software must be via digital links — no manual re-keying. A simpler approach is to use end-to-end MTD software like GoFile.

What is bridging software?

Bridging software is a lightweight application that connects your existing records (e.g. a spreadsheet) to HMRC’s MTD systems. It reads your data digitally and submits it to HMRC. While this satisfies the legal requirement, end-to-end software typically provides a better experience.

Is GoFile MTD-compatible?

Yes. GoFile is HMRC-recognised MTD-compatible software for both VAT and Income Tax Self Assessment. It handles digital record-keeping, quarterly updates, and direct filing to HMRC. You can try it free.

Sources

Find software that is compatible with Making Tax Digital for VAT — GOV.UK
Find software that is compatible with Making Tax Digital for Income Tax — GOV.UK
Overview of Making Tax Digital — GOV.UK
Making Tax Digital for VAT – VAT Notice 700/22 — HMRC