Guides · Published 5 August 2026 · Updated 15 August 2026
The cheapest way to do MTD, from £0 upwards
We build QuarterFile, a paid MTD tool with a free tier, so read this knowing that. Every price here is dated so you can check it.
Complying with Making Tax Digital (MTD) for Income Tax can cost £0. Genuinely free, HMRC-recognised software exists with no trial clock, and HMRC’s own software finder (opens in a new tab) filters for it. Everything above £0 buys time or help, not permission. The ladder below shows what each step adds.
What does each price band buy?
Prices are as we checked them in July and August 2026. Free tiers move fast, so confirm on the provider’s own site before you rely on one:
| What you pay | What you get | The catch |
|---|---|---|
| £0 | Genuinely free recognised software: every option and its limits | You do the typing, and support is thin in deadline week |
| £0 through your bank | FreeAgent free with NatWest, RBS or Mettle; Monzo files from inside the app on every business plan; Lloyds, Starling, Tide, SumUp and Coconut have free offers too: the bank-bundled route | Only free while you stay with that bank |
| A few pounds a month | Bridging tools that file from your spreadsheet, or record-keeping tools that import and categorise your bank statement (QuarterFile Plus is £12.50 a quarter, first quarter free: pricing) | Bridging still leaves the bookkeeping to you |
| £7 to £40 a month | Full accounting software: bank feeds, invoicing, receipt capture (what £7 buys) | You may be paying for jobs MTD never asked for |
| Accountant fees on top | A person handles some or all of it: how MTD works with an accountant | The most cost, though also the least of your time |
When is free the right answer?
When your affairs are simple, the transaction count is low, and you don’t mind typing. That covers plenty of single-property landlords and small side traders. A free tool keeps you exactly as compliant as a paid one: recognised is recognised.
When is paying for something worth it?
- The typing: a tool that reads your bank statement and categorises it gives you back an evening a quarter.
- Support: a person who answers email in deadline week costs money, and earns it the first time something looks wrong.
- Caps: free tiers with invoice or entry limits stop exactly when a busy quarter needs them most (our free software guide lists each one’s limit).
Does the answer change for landlords?
The ladder is the same; the fit shifts. Rental income usually means fewer, more regular transactions, so free manual tools stretch further, and the bank-bundled route works if your rent lands in a qualifying account. Joint ownership is the wrinkle worth reading about: MTD for joint landlords covers whose share files where, and our landlords page pulls the property answers together.
What’s the cheapest mistake to avoid?
Buying more software than the job needs. A quarterly update is a summary of totals, not an audit (what one actually is), and a £40-a-month suite doesn’t file it any harder than a free tool. Decide what your time is worth, pick the lowest rung that covers it, and put the difference towards January’s tax bill.
Whatever rung you pick, the deadlines are the same: add them to your calendar and switch on free reminders.
Not sure when MTD applies to you?
Take the two-minute checkerAlready know your date? Get an email before each deadline.
This guide is general information, not tax advice. For your own position, check with your accountant or HMRC.