Can I connect with HMRC for making tax digital using quickbooks self-employed?

Great question, Sarah. We’re here to help and guide you toward the best solution for your goals.

Currently, QuickBooks Self-Employed (QBSE) doesn't support HMRC's Making Tax Digital (MTD) compliance. While QBSE is effective for tracking income and expenses and simplifying tax estimates for sole traders and freelancers, it is not compatible with MTD requirements, such as submitting VAT returns directly to HMRC.

To comply with MTD requirements, we recommend switching to QuickBooks Online (QBO), which is fully HMRC-recognized for MTD submissions. QBO offers powerful features to help you track VAT, generate MTD-compliant VAT returns, and submit them directly to HMRC with ease.

Just let us know how we can assist you, and we will guide you through the process to ensure a smooth transition.

Hi, thanks for your reply. 

I note you say 'currently - are there plans to make Quick books self-employed HMRC compatible before the 2027 tax year?

I am not VAT registered, I will be just over the £30,000 limit next year and am a sole trader. I initially used Quickbooks online but found it much less appropriate for my needs as I did not need most of the features, so it was quite confusing, as well as more costly for features I don't need.

I would love to stay with Quickbooks but if I can't use self-employed to connect with HMRC then it is not going to be the best tool for me

Hi, I am bumping my question up again - will you be connecting Quickbooks selfemployed to MTD in the future?  I have a couple of years to decide on final software solution, but this would be the easiest option for me. As I don't pay VAT and use cash basis accounting I just need a very simple system - quickbooks online was overkill/difficult to navigate as it is not designed for my type of business

I understand that simplicity and compliance are key for your business, Sarah. As of posting, we haven't received updates for QuickBooks Self-Employed (QBSE) that support this feature. However, you may want to consider QuickBooks Sole Trader, which supports MTD for Income Tax.

This product is designed specifically for independent individuals and landlords, offering features that cater to the unique needs of small business owners while remaining simple and easy to use. You can explore this in more detail here: Introduction to QuickBooks Sole Trader.

I also recommend contacting our sales team if you’re interested in exploring this option further. They can provide expert advice, discuss its features, and help determine if it aligns with your business needs and expectations.

When you're ready to switch, it’s important to download and save all the data from your QBSE account, including reports, transactions, mileage logs, receipts, and invoices. Once the transfer is complete, the platform will no longer be accessible.

Here’s how to move automatically:

1. In your QBSE account, go to Settings, then Upgrade.
   
   
2. Under the Sole Trader column, Select plan.
3. Review the updated features, then Continue.
4. We’ll show you what data we’re copying over. Click Download Data if you haven’t saved your records yet.
5. Pick Continue to proceed. Then, Get started.
6. Choose Get started again, then Start.
7. Confirm or update a few details about your business to start using the program.

For more insights, please refer to this article: Switch from QBSE to Sole Trader.

I hope this information clarifies your options. If you have further questions about Sole Trader and MTD for Income Tax, please don’t hesitate to get in touch. I'm always here to assist and make the process as smooth as possible. Take care.