The implementation of Making Tax Digital for Income Tax (MTD IT) for certain taxpayers represents a significant step in the UK Government’s plans to digitise the tax system. From April 2026, any self-employed individual or landlord with income from their business over £50,000 must keep records digitally and submit information quarterly to HMRC using commercial software. In addition to the quarterly submissions, a final declaration must be made before submitting the annual self-assessment tax return.

From April 2027 the qualifying threshold is reduced to income of £30,000 and reduced again to £20,000 from April 2028.

Accountants with high numbers of sole trade and landlord clients are facing a number of challenges as they get ready for the new MTD IT regime.

Key Challenges facing accountants

Client Communication

Many sole traders and landlords are unfamiliar with digital bookkeeping and will contact their accountant only when their self-assessment tax return needs to be completed each year. Under MTD IT, accountants now need to spend time getting clients up to speed with their new responsibilities and offer services to meet their needs. Some clients will be comfortable updating digital records and submitting information to HMRC and require limited support. Others will have no interest in bookkeeping or accounting and expect the accountant to complete all necessary tasks on their behalf.

Communicating these changes to clients takes time and resources and may require difficult conversations where additional fees are necessary. By outsourcing recurring work such as bookkeeping or the submission of information to HMRC each quarter, accountants can free capacity to work with clients and understand their MTD IT service needs. Outsourcing also offers the opportunity to provide services at a cost clients are comfortable with and can add value to an otherwise compliance focused service.

Managing peaks of work

Accountants are already manging severe peaks of work to submit information to HMRC throughout the tax year. Monthly payrolls need to be filed, and VAT returns submitted each quarter. Accountants managing year-end accounts work also experience peaks of work around popular year-ends such as 31 March or 31 December and need to file company tax information quickly and efficiently to help clients avoid fines and penalties.

MTD IT increases the pressure on accountants to deliver work when regulatory deadlines are looming. Accountants can manage workflows effectively by outsourcing MTD IT and self-assessment tax return work to an offshore provider.

Recruitment and Retention

For many UK accountants, the recruitment market remains challenging and expensive to navigate. Risks are evident across a number of fronts, including:

Skills shortages – especially among bookkeepers and trainee accountants
Rising recruitment costs
Training and development costs
Retaining staff in high demand roles.

Outsourcing provides access to a broad range of qualified professionals. Most MTD IT tasks such as digital bookkeeping, quarterly returns, year-end accounts, and personal tax work can be outsourced. By working with a specialist outsourcing partner, accountants can:

Access talent immediately
Avoid recruitment costs and HR management
Leverage UK accounting expertise
Scale flexibly.

Thanks to cloud accounting and digital systems, outsourced teams can seamlessly integrate with onshore workflows with minimal disruption.

Pricing

Small and medium-sized businesses expect fixed fees, digital-first service, and faster turnaround times. Accountants unable to deliver MTD IT services efficiently risk losing clients or reduced profitability. Using an offshore accountant means prices can be fixed for the duration of a contract, allowing accountants to offer fixed price subscription models and guaranteed service levels to clients. The onshore team can spend more time with the most complex clients, understanding client needs, building long-term relationships and offering additional services.

Achieving objectives for growth

Scaling a practice up or down takes time. Investment in technologies such as AI, cloud accounting and automation of tasks means accountants can scale and grow without taking on the additional risk and costs of direct employment. Where a practice is looking to downsize, contracts with an outsourced supplier can be terminated in a matter of weeks and in a structured way. There is no need to implement redundancy processes or statutory consultation with employees.

Accountants can choose to access offshore capacity as and when they need it by using a pay as you go service. This maximises the flexibility to use an offshore option at peak periods or where a backlog of work needs to be cleared. This flexibility enables practices to grow without the long-term cost and risk of extra headcount.

Choosing the right software

HMRC decided MTD IT should be implemented with commercial software providers offering compatible digital platforms to submit information each quarter. Choosing the best software, at a cost clients are willing to pay, is a particular challenge for accountants at a time when they are notifying clients about increases in fees to provide MTD IT services.

Outsourced accountants are proficient in all commercial cloud-based software providing wide scope for outsourcing work. They can update client records on any bookkeeping software, review eligible expenses, and complete monthly bank reconciliations. When quarterly submissions are due, the offshore accountant can prepare summaries of income and expenses for client review and submit the information to HMRC.

Why outsourcing is a smart strategy

Consistent, MTD-Ready Information

Outsourced teams work to agreed turnround times and quality standards to ensure:

Transactions are correctly recorded on compatible, cloud-based software
Digital records are complete, accurate and fully reconciled
Quarterly submissions to HMRC are made on time and based on reliable data.

By offshoring record keeping tasks to a dedicated resource, the scope for errors is reduced and compliance is assured.

Less Pressure on Onshore Teams

Rather than stretching existing staff to take on responsibilities to obtain data from clients and update records, outsourcing:

Frees up accountants to undertake work to support clients and generate additional fees
Eliminates the costs of recruitment and training
Smooths workloads as quarterly deadlines approach.

When structured correctly, outsourcing works as an extension of the onshore team – aligned to existing processes, software, and quality standards without the risks of a permanent appointment.

Better Client Experience

Many clients struggle with digital record-keeping. Outsourced accountants:

Reduce the pressure on in-house teams to contact clients for missing data
Ensure digital records are maintained accurately and on time
Help clients stay compliant.

As accountants shift resources away from recurring tasks they have more time to focus on client relationships, tax advice, and business development.

Scalable Support as MTD Expands

From April 2028, any individual with self-employed or landlord income above £20,000 will need to meet MTD IT requirements. To meet the projected demand for record keeping services, accountants will need to:

Scale capacity quickly as client numbers grow
Support quarterly peaks of work
Update processes as HMRC requirements evolve.

Outsourcing offers a scalable, flexible solution that allows accountants to quickly increase capacity without the overheads and administrative burden of full-time or temporary appointments. Outsourcing work enables accountants to stay agile, efficient, and competitive throughout the year.

Is Outsourcing a Smart Strategy for Your Firm?

By working with a specialist outsourcing partner, accountants can:

Access resources immediately: Offshore accountants are proficient in commercial accounting software and are ready to start immediately
Avoid recruitment costs and HR management: The outsource provider handles contracts, salaries, and employee benefits
Leverage expertise: Offshore professionals are up to date on the detailed requirements of MTD IT and required records
Scale flexibly: Add capacity as demand grows without the risk of recruitment delays. Where demand falls, services can be scaled down without any exit costs.

Outsourcing MTD IT work is particularly effective for accountants:

Supporting high numbers of sole traders or landlord clients
Looking to scale and expand MTD IT services
Looking to protect margins while remaining competitive
Struggling to support clients with high volumes of transactions.

Unison Globus UK Your Offshore Accounting Partner

Outsourcing MTD IT work to Unison Globus UK offers many benefits to UK accountants through:

Helping clients comply with HMRC requirements.
Reduced risk of penalties for late/missing submissions
Reduced costs and overheads
Access to talent and resources
Increased quality and consistency of work
Better turnaround times
Improved client experience
Data security assurance.

How do I find out more?

If you want to learn more about how outsourcing can simplify MTD IT, explore our Making Tax Digital for Income Tax hub and book a free 10-hour trial with Unison Globus UK. We promise to turn your trial work around within 72 hours. You can book a video call with one of our expert advisors using this link or send an email to [email protected]