Making Tax Digital · Sole traders
Digital exclusion: who can qualify for an MTD exemption?
ONLY£15A MONTHMaking Tax Digital includes exemptions for people who cannot reasonably use the required digital systems.
Making Tax Digital includes exemptions for people who cannot reasonably use the required digital systems. The decision depends on circumstances, not a stereotype about age or technology. It is worth reading the actual criteria before assuming that you must struggle through or that an application will automatically succeed.
What HMRC considers
HMRC's exemption guidance identifies reasons including age, health or disability that prevent digital use, qualifying religious beliefs, and lack of reasonable internet access because of location.
Prior paper filing, unfamiliarity with software, few transactions or extra time and cost are not normally sufficient on their own. HMRC considers applications individually. The guidance expressly says that an agent, friend or family member can apply on your behalf and that the decision remains based on your circumstances.
Do not assume that any family assistance automatically removes eligibility. Explain the assistance actually available, its limits and why the required digital tasks remain unreasonable in your case.
Other automatic or temporary exemptions have separate conditions. Check the complete guidance, including any relevant tax-return pages or status, rather than treating all exemptions as digital-exclusion applications.
Worked comparison: two different barriers
| Situation | Useful information to establish |
|---|---|
| Unfamiliar with a new app | Whether accessible guidance or support makes use reasonable |
| Disability prevents required digital tasks | The practical effects and any workable assistance |
| No suitable internet access | Home, business and reasonable alternative access |
These are questions to explain, not predictions of HMRC's decision.
Keep the evidence connected to the figures
Your digital record should explain the amount, date and nature of the transaction. Keep the invoice, receipt, statement or other evidence that supports it. A photograph can make a paper document easier to retain, but a folder of photographs alone does not create complete transaction records.
For sole traders, HMRC normally requires business records to be kept for at least five years after the relevant 31 January filing deadline. Keep them longer where the rules for a late return, enquiry or other circumstances require it. Check the record-retention guidance.
Make the records usable by your future self. Include a short explanation where a bank description is vague, retain the calculation behind a business-use split and make corrections traceable. For a missing receipt, try the supplier account, email confirmation or a replacement invoice before relying on incomplete evidence.
At review time, compare your records with the bank or payment account and investigate differences. Equal totals are useful, but two errors can cancel each other out. A sample of individual transactions can reveal a duplicated purchase or an omitted customer receipt that a totals-only check misses.
Choose software by the work it needs to do
Start with your actual income sources and records. A sole trade, a UK property business and foreign property can involve different requirements. A product suitable for one set of circumstances is not automatically suitable for every annual-return item you might have.
HMRC's software guidance allows different approaches, including software connected to existing spreadsheets. Check the complete workflow: importing or recording transactions, reviewing the quarterly summary, submitting it, making corrections and completing the annual return.
Try a representative sample that includes a refund, a private transaction, a cash item and an awkward bank description. Ask how the system handles a missing period and how you export records if you leave. These questions are more informative than a long feature list.
Software support and professional tax advice are different services. Confirm who answers each kind of question, when help is available and what the quoted fee covers. Avona.app's entry-level self-service price is £15/month; professional services and additional product capabilities should be checked against the current scope rather than assumed to be included.
Share the information needed for the task
Tax records need to be useful without containing unnecessary personal detail. Keep payment references sufficient to reconcile the accounts, and hold sensitive client notes in the appropriate restricted system. Financial software should not become a second, informal store for clinical notes or identity documents.
Use individual accounts and the access controls available for the service. Remove access when a working relationship ends. A secure product can still be misused through shared sign-ins, forwarded access links or files sent to the wrong person.
For Open Banking, distinguish account-information access from payment initiation. Read the consent screen and check the authorised provider. Account-information permission does not itself authorise moving money, but Open Banking as a whole also includes separately authorised payment services. The FCA explains these different services.
If you need an assurance about encryption, hosting, retention or security testing, ask for the current documented answer. Terms such as “bank-grade” do not tell you which controls apply to a particular service. Choose a workflow whose permissions and responsibilities you understand, and protect the email or phone account used to recover access.
Prepare a clear application
Describe the tasks you cannot reasonably complete, the reasons and relevant supporting information. Use the official application route and retain the outcome. An exemption from MTD does not remove the obligation to report taxable income through the applicable Self Assessment process.
Take the next step
Avona.app offers a self-service route from £15/month. Bring your records together, review the figures and choose a workflow that fits your business. For professional help, discuss the scope and total price of Avona Concierge, managed by chartered accountants, before choosing a service.