What is MTD bridging software?
MTD bridging software connects records kept in spreadsheets or other non-compatible tools to HM Revenue and Customs, so a business can file Making Tax Digital VAT returns and Income Tax quarterly updates without moving its bookkeeping into new software. It reads the spreadsheet through a digital link and sends the figures through HM Revenue and Customs's MTD APIs.
Also calledbridging software for MTDMTD VAT bridging software
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- Links
- Spreadsheets to HMRC
- Covers
- VAT and Income Tax
- Copy and paste
- Not a digital link
How MTD bridging software works
VAT Notice 700/22 defines bridging software as a digital tool that incorporates the MTD APIs and links accounting records with HM Revenue and Customs's systems. Every step between the records and the return must be a digital link, such as linked spreadsheet cells, a CSV import or an API transfer; copying and pasting or retyping figures does not count. HM Revenue and Customs's MTD for VAT software finder lists around 470 products and can filter for bridging software and free versions, and the authority a business gives its software lasts 18 months. For MTD for Income Tax, which started on 6 April 2026 for sole traders and landlords with qualifying income over £50,000, spreadsheets must be digitally linked to bridging software before each quarterly update, and some bridging products also file the tax return. Prices are low: 123 Sheets costs £19.75 plus VAT a year per taxpayer, TaxCalc VAT Filer for Business starts at £22 a year, VitalTax at £30 a year plus VAT for one National Insurance number, and QuickFile at £60 plus VAT a year after a free first VAT return.
Common questions
Is there free MTD bridging software?+
HM Revenue and Customs's software finder has a filter for products with a free version. QuickFile's first VAT return is free, VitalTax's first quarterly Income Tax submission is free, and 123 Sheets has a free version in the finder.
Can I use a spreadsheet for MTD for Income Tax?+
Yes, if it is digitally linked to bridging software. Records in a quarterly update must not be moved by retyping or copying and pasting, and only one product can be used for each submission.
What counts as a digital link for MTD VAT?+
Linked spreadsheet cells, XML or CSV import and export, downloading and uploading files, API transfers and emailing a spreadsheet of records. Copying and pasting or retyping figures does not.
How much does MTD bridging software cost?+
123 Sheets costs £19.75 plus VAT a year per taxpayer, TaxCalc VAT Filer for Business £22 to £40 a year, VitalTax £30 a year plus VAT for one National Insurance number, and Absolute's Excel VAT Filer £40 plus VAT for ten traders.
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