The Simplest and Cheapest Way to Do Make Tax Digital
Make Tax Digital introduces additional reporting requirements and a shift towards digital record keeping, however compliance does not need to be complex or expensive. For many individuals, particularly sole traders and landlords, a simple and structured approach can meet HMRC requirements without the need for high cost software or fully outsourced solutions.
Understanding what you actually need
To comply with Make Tax Digital for Income Tax Self Assessment you are required to maintain digital records of your income and expenses, submit quarterly updates, and complete a final end of year declaration. The legislation does not require you to purchase expensive all in one accounting systems. It requires accurate digital records and a method of submitting data to HMRC.
A simple low cost approach
A practical and cost effective method is to separate record keeping from submission. Using a straightforward tool to track income and expenses, combined with either bridging software or accountant support for submission, allows you to remain compliant without overcomplicating your processes.
Using Tax Snapper for record keeping
Tax Snapper provides a simple way to track income, expenses and profit in real time without the complexity of traditional accounting software. The app is free to use for tracking, allowing you to maintain digital records in line with Make Tax Digital requirements without ongoing subscription costs. This makes it particularly suitable for individuals looking to keep administration simple and controlled.
Generating quarterly reports only when needed
One of the key requirements under Make Tax Digital is the submission of quarterly updates. With Tax Snapper, you only pay when you need to generate a quarterly report. Reports can be downloaded for £6.99, meaning you are not tied into a monthly fee and only incur costs at the point of reporting. This pay as you go approach keeps costs low while still meeting compliance requirements.
Submitting your data to HMRC
Once your quarterly reports are prepared, there are two straightforward options for submission. You can upload the data using bridging software that connects your records to HMRC systems, or you can provide the reports directly to your accountant who can handle the submission on your behalf. This approach allows you to remain compliant without committing to higher cost software subscriptions.
Keeping costs under control
Many businesses assume that Make Tax Digital will require significant investment in new systems. In practice, using Tax Snapper alongside either bridging software or accountant support allows you to keep costs predictable and proportionate. By only paying £6.99 when a report is required, you avoid unnecessary ongoing expenses.
Avoiding common mistakes
Simplicity should not come at the expense of accuracy. It is important to ensure that all income and expenses are recorded consistently and that reports are generated on time. Relying on incomplete records, delaying updates or using non digital methods will create risk under the new regime. A simple system works effectively only when it is used consistently.
Is this approach right for you
This method is particularly suitable for sole traders, landlords and small business owners with straightforward financial affairs. Where transactions are limited and there is no requirement for complex reporting, a streamlined approach can deliver full compliance without unnecessary administrative burden.
Summary
Make Tax Digital does not require complex systems or high monthly costs. By using Tax Snapper to track income, expenses and profit for free, then paying £6.99 only when you need to download quarterly reports, you can meet your obligations in a simple and cost effective way. Combined with bridging software or accountant support for submission, this approach allows you to stay compliant while maintaining control over both your processes and your costs.