MTD is coming. Here's how to be ready — using WhatsApp.

Making Tax Digital (MTD) is a government initiative that requires self-employed individuals and landlords to keep digital records and submit quarterly updates to HMRC using compatible software. If you earn over £50,000 from self-employment or property, MTD applies to you from April 2026. The threshold drops to £30,000 from April 2027. This affects builders, plumbers, electricians, plasterers, roofers and all other self-employed tradespeople in the UK.

Instead of learning accounting software, you simply photograph your receipts, invoices and expenses and send them to our dedicated 123Tax WhatsApp number. Our system reads each receipt, categorises it into the correct HMRC expense category, and keeps a running total of your income and outgoings. When your quarterly submission is due, we compile the summary and send it to you for approval. You confirm with a single reply and we submit directly to HMRC on your behalf. There is no app to download, no login to remember, and no spreadsheets to fill in.

HMRC operates a points-based penalty system for late submissions under Making Tax Digital. Each late quarterly update adds a penalty point. Once you reach the threshold (four points for quarterly obligations), you receive a £200 penalty. Further late submissions incur additional £200 fines. Persistent non-compliance can lead to escalating penalties. With 123Tax, we send you deadline reminders two weeks in advance and handle the submission process for you, so you never have to worry about missing a deadline.

Yes. 123Tax is fully HMRC-recognised software for Making Tax Digital for Income Tax Self Assessment. We connect directly to HMRC's systems to submit your quarterly updates and end-of-year finalisation. Your data is transmitted securely and meets all MTD compliance requirements. You do not need any additional software or tools to satisfy HMRC's digital record-keeping obligations when using 123Tax.

Absolutely. If you work as a subcontractor under the Construction Industry Scheme, your contractor deducts tax at source from your payments. Many CIS subcontractors overpay tax throughout the year because the standard CIS deduction rate of 20% does not account for your allowable expenses. When we file your Self Assessment tax return, we claim back any overpaid CIS tax on your behalf. Our customers have claimed back an average of £2,500 per year in CIS refunds. Our CIS Pro plan at £29 per month includes CIS deduction tracking, statement reconciliation and full refund claims.

For most sole traders and CIS subcontractors, 123Tax replaces the need for a traditional accountant. We handle your digital record-keeping, quarterly MTD submissions, Self Assessment tax return filing, and CIS refund claims. Our service costs from £19 per month compared to a typical high-street accountant who charges between £500 and £1,500 per year for similar services. If your tax affairs are more complex — for example, if you operate through a limited company with multiple directors — our Business+ plan at £49 per month includes VAT returns, year-end accounts and corporation tax filing with a dedicated account manager.