Making Tax Digital in April 2026: How Orkney Businesses Can Prepare Now

By ABM Orkney Ltd

From 6 April 2026, one of the biggest changes to Income Tax in recent years comes into force. If you’re self-employed or a landlord, Making Tax Digital (MTD) for Income Tax will fundamentally change how you report to HM Revenue & Customs.

At ABM Orkney Ltd, we’re already working with local businesses and landlords to get ahead of this. The key message? This does not need to be stressful, but it does require action.

What Is Changing?

Under MTD for Income Tax, the traditional once-a-year Self-Assessment tax return will be replaced with:

Quarterly digital submissions of income and expenses
Digital record-keeping (no more manual spreadsheets alone)
A final year-end declaration

This means saying goodbye to the January rush and the “shoebox of receipts” approach. Instead, bookkeeping becomes a regular, structured process throughout the year.

Who Is Affected from April 2026?

From 6 April 2026, MTD will apply to:

Self-employed individuals
Landlords
With gross income over £50,000 per year

From April 2027, the threshold drops to £30,000.

Gross income means total business or rental income before expenses.

If you’re a contractor, tradesperson, freelancer, tourism operator, or property landlord and your income is above the threshold, this will apply to you.

Limited companies and Partnerships are not included in the April 2026 rollout.

Why Is This Happening?

HMRC’s aim is to:

Reduce tax errors
Increase accuracy
Move taxpayers onto digital systems

From a small business perspective, it does mean more frequent reporting. If you currently prepare your figures once a year, four submissions may feel overwhelming.

However, when set up properly, quarterly reporting is far less painful than one large annual scramble.

How to Prepare Now

1. Move to Digital Bookkeeping

You must use HMRC-recognised software. Popular options include:

Xero
QuickBooks Online
Sage
FreeAgent

These systems:

Import bank feeds automatically
Allow receipt capture via mobile apps
Keep your records live and up to date
Make quarterly submissions far easier

At ABM Orkney, we help clients choose and implement the right system, and ensure it’s configured correctly from day one.

2. Treat Bookkeeping as a Monthly Habit

Instead of one annual panic, MTD encourages:

Monthly reconciliation
Quarterly review
Proactive tax planning

Smaller, regular updates are quicker and more accurate than one large year-end reconstruction exercise.

3. Use This as a Business Improvement Opportunity

There is a genuine upside.

With live digital records, you can:

Monitor profitability quarterly
Identify rising costs early
Improve cashflow planning
Make tax provisions in advance

Rather than looking backwards once a year, you gain real-time insight into your business performance.

For many of our clients, this alone justifies moving digital early.

4. Avoid Future Penalties

There may be a soft-landing period initially, but MTD compliance will become mandatory. Failing to comply could lead to penalties.

April 2026 is not far away.

If you are reading this in early 2026, you have a short window to transition smoothly instead of reactively.

How ABM Orkney Can Help

We are already preparing our clients for MTD by:

Reviewing income levels to confirm applicability
Moving clients onto compliant bookkeeping systems
Setting up structured quarterly workflows
Managing submissions directly where required
Providing clear, proactive tax forecasting

Our aim is simple: remove stress, ensure compliance, and improve clarity over your numbers.

Don’t Leave It Until the Last Minute

If you are unsure whether MTD will apply to you, or you are still using spreadsheets or manual records, now is the time to act.

📞 Contact ABM Orkney Ltd today on 01856 881082
📧 Email us to arrange a no-obligation chat: info@abmorkney.com
📍 Supporting businesses and landlords across Orkney

Let’s get your systems in place before April 2026 arrives — and turn Making Tax Digital into an opportunity, not a disruption.

If you would like us to review your position and map out a clear MTD plan, get in touch. We’re ready when you are.