QuickBooks

QuickBooks is HMRC-recognised for Making Tax Digital for Income Tax, handling your quarterly updates and final declaration in one place. The Sole Trader Plus plan is currently discounted to £1 a month (plus VAT) for six months, then £10 a month (plus VAT).

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At a glance

QuickBooks Sole Trader Plus is built around the MTD for Income Tax workflow: it logs income and expenses digitally, generates your four quarterly updates, and prepares your final declaration at year end. It’s on HMRC’s official list of recognised software for MTD for IT, though this entry-level plan doesn’t cover MTD for VAT.

£10/m

£1/m

First 6 months (90% off)

Sole Trader Plan

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Is QuickBooks HMRC-recognised for MTD?

Yes. QuickBooks Online - including the Sole Trader Plus, Simple Start, Essentials, Plus and Advanced plans - is on HMRC’s official list of software recognised for Making Tax Digital for Income Tax. That means you can use it to submit quarterly updates and your final declaration directly to HMRC. Software recognition status can change, so it’s worth checking HMRC’s live software finder tool before committing for a full tax year.

How does QuickBooks handle MTD for Income Tax?

Once you’ve registered for Self Assessment with HMRC and separately opted in to MTD for IT via Government Gateway, you connect QuickBooks to HMRC through a one-off “digital handshake” done inside its Income Tax app.

Digital record keeping: every sale, expense and bank transaction is logged digitally, satisfying HMRC’s digital records requirement
Quarterly updates: QuickBooks totals your income and expenses and lets you submit four updates a year straight to HMRC, with deadlines shown on your Income Tax dashboard
Final declaration: at year end, QuickBooks helps you finalise your figures and submit your Final Declaration, which replaces the old Self Assessment return, by the 31 January deadline
Re-authorisation: for security, HMRC requires the digital handshake to be refreshed every 18 months, and QuickBooks flags when this is due

Key MTD-specific features

HMRC “digital handshake” authorisation built into the Income Tax app
Automatic four-quarter obligation calendar once connected to HMRC
Year-to-date Income Tax estimate so you can see roughly what you’ll owe ahead of the final declaration
Bank feed automation to keep digital records current with minimal manual entry
Mobile receipt capture and mileage tracking that feed directly into your digital records
Support for reporting combined business and rental income within one account

Which QuickBooks plan do you need for MTD for IT?

QuickBooks Sole Trader Plus is the entry-level, MTD for IT-ready plan aimed at sole traders who aren’t VAT-registered. If you’re also VAT-registered, you’ll need to move up to Simple Start or higher, since Sole Trader Plus doesn’t include VAT submission.

Sole Trader - £10/month, currently £1/month for 6 months

The entry-level, MTD for IT-ready plan for non-VAT-registered sole traders:

Digital record keeping, quarterly updates and final declaration for MTD for IT
Currently discounted to £1/month (plus VAT) for the first six months for new customers
Doesn’t include MTD for VAT submission

Simple Start - £16/month

If you’re also VAT registered:

Everything in Sole Trader, plus
VAT return submission and management
Fuller reporting

This is a current promotional rate - always check QuickBooks’ UK pricing page for the latest terms before signing up.

Pros and cons

Pros:

HMRC-recognised for MTD for IT out of the box - no separate bridging software needed
Covers the full workflow: digital records, quarterly updates, and final declaration
Cheapest entry point among the major HMRC-recognised full accounting platforms
Clear obligation dates and re-authorisation reminders reduce the risk of missed deadlines
Widely used by UK accountants and bookkeepers, so it’s easy to get help with your MTD setup

Cons:

Sole Trader Plus doesn’t cover MTD for VAT - VAT-registered sole traders need a pricier plan
Doesn’t currently support foreign property income for MTD IT reporting
Workflow leans heavily on connected bank feeds; cash or unbanked transactions need extra manual input
The discounted rate is a new-customer promotion only, reverting to the standard price after six months
The digital handshake needs re-authorising every 18 months - one more compliance task to track

Who is QuickBooks best for MTD for Income Tax?

For sole traders who’ll need to comply with MTD for IT - income over £50,000 from April 2026, or £30,000-£50,000 from April 2027 - QuickBooks is a solid, HMRC-recognised option that handles the whole cycle: digital records, quarterly updates and the final declaration, without needing extra bridging software. Sole Trader Plus is currently one of the cheapest ways in, especially with the six-month discount, though anyone who’s also VAT-registered will need a higher plan. For a broader look at QuickBooks as an everyday accounting tool, see our full QuickBooks review elsewhere on this site.

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Frequently asked questions

Is QuickBooks free for MTD for Income Tax?

No. QuickBooks doesn’t have a free plan for MTD for IT. Sole Trader Plus starts at £10/month plus VAT, discounted to £1/month plus VAT for the first six months at the time of writing.

Do I need to sign up for MTD for IT separately from creating a QuickBooks account?

Yes. You need to register for Self Assessment with HMRC and separately opt in to MTD for IT via HMRC’s sign-up page, before connecting QuickBooks through its digital handshake.

Can QuickBooks submit my quarterly updates and final declaration directly to HMRC?

Yes. Once connected via the digital handshake, QuickBooks lets you submit both your quarterly updates and your Final Declaration directly to HMRC from within the software.

Does QuickBooks handle MTD for VAT as well as MTD for Income Tax?

Only on the higher plans (Simple Start and above). The entry-level Sole Trader Plus plan is built for MTD for IT and doesn’t include VAT submission.

What happens if QuickBooks loses its HMRC recognition?

You wouldn’t be able to use it to file quarterly updates or your final declaration. Software recognition status can change, so it’s worth checking HMRC’s official recognised software list before committing for a full tax year.

Compare MTD software for sole traders

QuickBooks is one option among several worth comparing. Browse the full MTD Software directory to compare it against Sage, Xero, FreeAgent and other HMRC-recognised options.

Pricing and offers correct at time of publication. Always check the QuickBooks website for current pricing and promotional terms before signing up.