Making Tax Digital: Simple Tips To Reduce Admin

Making Tax Digital is HMRC’s move towards digital tax reporting. Instead of filing one tax return at the end of the year using paper records or a box full of receipts, as a CIS worker you now need to keep digital records and submit updates to HMRC more regularly using MTD-compatible software.

For many self-employed tradespeople, the biggest issue is how you manage digital record-keeping.

We appreciate that construction-related work rarely happens behind a desk! You’re on-site, travelling between jobs, paying for fuel, and dealing with paperwork on the go. That makes staying organised much harder than it is for someone working in an office. The good news is that keeping digital records doesn’t need to be complicated.

Why Keep Digital Records?

Historically, it’s likely you’ve relied on paper receipts, handwritten notes, or memory to recall expenses months later. The problem is that this often leads to missing allowable expenses, incorrect tax returns and last-minute stress at tax time.

Under Making Tax Digital, accurate digital records are increasingly important. HMRC wants businesses and you to maintain up-to-date records throughout the year rather than sorting everything out at year-end.

Use Your Phone

One of the easiest ways to stay compliant is by using your phone properly. FreeAgent, the accounting app included in our MTD service, allows you to photograph receipts instantly and record expenses. This is far safer than leaving receipts in your van or toolbox, where they can easily get damaged or lost.

A good habit is taking a photo of every receipt as soon as you get it whether it’s for tools, parking, PPE, or materials. Once uploaded, the receipt is safely stored digitally and easier to track later.

Separate Business and Personal Spending

Using one bank account for everything makes bookkeeping difficult and increases the chances of mistakes. If possible, use a separate business bank account, a dedicated business card and digital payment methods instead of cash. This creates a cleaner record of your business activity and makes MTD reporting much simpler.

Act early

One of the biggest benefits of digital record keeping is reducing year-end panic. Instead of spending January searching for receipts, you can keep everything updated gradually throughout the year. This can be helpful in tracking if you’re likely to be able to claim a tax rebate on allowable expenses.

Let us help

Making Tax Digital may feel like another layer of admin, but it doesn’t have to become overwhelming. Simple habits like photographing receipts, using separate banking, and keeping records updated regularly can make a huge difference.

Our MTD service helps keep the change simple. It includes:

• Quarterly tax returns
• Digital record keeping
• Tax refund (if appropriate)
• Support on expense claims
• End-of-year tax return
• Award-winning MTD software (FreeAgent) and support to use it with ease

We can also help you set up a business bank account with Tide which offers a hassle-free app for all your business banking needs.

Find out more or speak to a member of our team today.