Become Making Tax Digital ready

Making Tax Digital requires businesses to manage their tax affairs with HMRC using compatible software.

Done before the coffee gets cold.

A tablet showing that a return has been submitted to the tax office.

Making Tax Digital explained

Making Tax Digital is a government initiative to improve tax administration. Ensure you meet HMRC requirements.

April 2022 extension

From April 2022, MTD requirements extend to smaller VAT businesses. Around 1.1m businesses will be affected.

Based on taxable turnover

MTD for VAT is currently mandatory for VAT-registered businesses with a taxable turnover above £85,000.

MTD software needed

Businesses need to use compatible, HMRC-recognised MTD software to keep digital records and file VAT returns.

Maintain digital records

Through MTD, VAT-registered businesses will be required by law to maintain their digital records.

MTD for accountants and bookkeepers

Prepare your practice and clients for Making Tax Digital requirements. Explore our helpful guides and toolkits.

Learn how to become MTD compliant

Simplify your business tasks with Xero

Xero is an all-in-one platform to simplify your business tasks. Track cash flow, invoice instantly, and file digital tax returns.

Learn what Xero can do

More about Making Tax Digital for VAT and Xero

Xero’s Making Tax Digital software works for VAT and non-MTD VAT returns. Once you sign up for MTD, you can only submit MTD VAT returns. All VAT-registered businesses will need to use MTD VAT returns from April 2022 (unless you have an exemption).

See how to set up MTD for VAT in Xero

If you use spreadsheets for VAT, you can still connect to HMRC’s MTD system via Xero. Xero provides bridging software that lets you upload VAT amounts, then send MTD VAT standard rate returns from Xero.

See how to get VAT data into Xero from spreadsheets

Set up for MTD with Xero

Get started in a few steps. Any Xero plan that supports VAT is compatible with Making Tax Digital.

Sign up for MTD

Log in to HMRC and sign up for Making Tax Digital.

Connect Xero to HMRC

You’ll receive a confirmation email, and be guided to connect HMRC digital tax with Xero.

Use the correct VAT filing

Use the MTD VAT return, and submit it to HMRC directly from Xero.

Use Xero for MTD

Access all Xero features free for 30 days, then decide which plan best suits your business.

Explore more MTD news and resources

Making Tax Digital for VAT

All VAT supporting Xero plans cover MTD at no extra cost. Find out more about how Xero and MTD works.

More about MTD for VAT

Making Tax Digital software

Learn more about why you need Making Tax Digital software that’s 100% HMRC compliant.

More about MTD software

Making Tax Digital resources

Explore our MTD webinars, guides, articles, and FAQs for everything you need to know about MTD for VAT.

MTD resources