Making Tax Digital vs Self Assessment, What's Actually Changing?

If you already do Self Assessment, Making Tax Digital might sound like a completely new system. It's not, it's more of an extension. Here's what's actually changing.

What stays the same

• You still need to report your income and expenses to HMRC
• The tax year is still 6 April to 5 April
• You still file a year-end tax return (this replaces your Self Assessment return)
• Your Government Gateway account still works
• The tax you owe is calculated the same way

What changes

• Quarterly updates, instead of once a year, you send summary figures four times
• Digital records required, paper records alone are no longer enough (a spreadsheet counts as digital)
• Software required, you must use compatible software to submit, not the HMRC online form
• Cumulative figures, each quarterly update includes year-to-date totals, not just the quarter

Is it more work?

Slightly, you're submitting four times instead of once. But each submission is much simpler than an annual return. You're sending two figures (your total income and total expenses), not a full breakdown. If your records are up to date, it takes a couple of minutes per quarter.

The year-end tax return is where the detail sits, much like the current Self Assessment return.

Do I still do Self Assessment?

The annual Self Assessment return is replaced by the year-end tax return under MTD. You don't file both. But the process is similar, the year-end tax return asks for the same information, just submitted through compatible software rather than the HMRC website.

Can I use the same software for both?

Some platforms (like Xero or FreeAgent) handle both quarterly updates and the year-end tax return. Bridging software like flonancial currently handles quarterly updates only. year-end tax return support at flonancial is in development, planned for April 2027, until then, you'll need a separate compatible product or your accountant for the year-end submission.

The practical difference

For most people, MTD means checking in with HMRC four times a year instead of once. If you already keep good records throughout the year, the quarterly updates are just a quick upload-and-submit. The biggest adjustment is remembering to do it.