MTD for ITSA: How to market your practice

This content is brought to you by Xero.

Making Tax Digital for Income Tax Self Assessment (MTD for ITSA), will come into effect in April 2024. For it, sole traders and landlords with an annual gross income of £10,000 or more will be required to comply with MTD for ITSA rules.

This article explores how you can market your accountancy practice to clients who will be impacted by the new legislation in six easy steps.

How will MTD for ITSA affect sole traders and landlords?

The new MTD for ITSA rules will require self-employed and landlord clients earning above £10,000 annually to use MTD-compatible software to keep digital records and submit updates to HMRC. From April 2024, they will be required to submit:

• Four quarterly updates (one every three months)
• An End of Period Statement
• A Final Declaration by January 31st following the end of the tax year

This will replace the current annual Self Assessment Tax Return. You will still be able to make submissions on behalf of your clients. However, you’ll no longer be able to use the online HMRC portal, or the paper (mail) filing system to submit their return.

Why is MTD for ITSA a good opportunity for accountants?

MTD for ITSA offers you the opportunity to streamline your processes, embrace digitalisation and save time. The previous Self Assessment system required annual reporting of income and expenses to HMRC, whereas the new MTD system requires quarterly reporting, which is automatically compiled by MTD software.

While it may take some time for your clients to adapt to the change, it should mean the previous workload of one annual Self Assessment is more evenly spread. Your clients should also find they’re able to better plan their finances and cash flow, as they’ll be able to see an estimate of their annual tax payment throughout the year.

For accountants, MTD for ITSA also offers you the opportunity to grow your practice. The new requirements present an opportunity for increased service offerings, such as support with choosing MTD software that best meets their needs.

How to market your practice for MTD for ITSA in five easy steps

Now is a great time to segment your clients and market your practice to those impacted by MTD for ITSA. Here’s how to begin marketing your practice in five easy steps.

1. Position your practice as experts on MTD for ITSA education

Many clients may feel uncertain of the upcoming changes, so it’s a good time to position yourself as an expert on MTD for ITSA and support them through the transition with educational resources communicating what the legislation means in plain English.

Start by providing education to your clients on what MTD for ITSA means for them, including specific changes to their tax returns process, like the new End of Period Statement and Final Declaration requirement. It’s also worth spending some time explaining the digital link rules. Xero’s MTD for ITSA resource hub contains a range of guides to help clients understand the changes.

2. Provide guidance on choosing MTD software

Your clients also will need to use HMRC-approved cloud accounting software to keep digital records. Some may be unfamiliar with cloud accounting software and digital record-keeping. It’s worth spending some time exploring the best options for your clients, based on their specific needs.

Xero, for example, makes a good choice for both landlords and sole traders. You can also become Xero certified to help your clients with onboarding and provide the best support throughout the MTD transition.

3. Highlight your MTD services on your website

Ensure you’re highlighting your services and how you can support clients with MTD compliance on your website. Your Search Engine Optimisation (SEO) strategy also plays an important part in attracting clients to your website.

A landing page targeted to ‘Making Tax Digital’ keywords can help your services rank well on Google. Be sure to include content and keywords targeting the most common MTD searches on Google.

4. Tap into your existing client network

Existing client networks can be a great resource in marketing. Ask your clients to review your practice on your Google My Business profile and any other popular accountancy review sites such as Trustpilot and Yelp.

It’s especially worth asking for reviews from clients that you’ve already supported with MTD for VAT. Or, if you’ve started supporting clients with MTD for ITSA, such as by signing them up for HMRC’s ITSA pilot with a participating software such as Xero, get in touch with them for reviews or quotes you can use across your website or marketing collateral.

5. Host an MTD for ITSA webinar

Creating video and webinar content is a great way to market your practice’s expertise. You can help sole traders and landlords prepare for MTD for ITSA by running an educational webinar on MTD for ITSA.

Use webinar or video content to educate existing and potential sole trader clients about the upcoming changes and how you can help. Provide an overview of the overall Making Tax Digital timeline, along with a look at the MTD software options that can support them with the transition.

6. Join the Xero Partner Programme

Become a Xero Partner today and list your practice on the Xero Advisor Directory. Creating a Xero advisor directory listing can help potential clients find your practice and the services you offer. It’s a good way to attract landlords and sole traders who may be looking for support with the transition to Making Tax Digital for ITSA.

Get your practice ready for MTD for ITSA today. You can learn more about how to prepare for MTD for ITSA and access resources to support your clients with the transition by browsing the resources on Xero’s MTD for ITSA content hub.

This content is brought to you by Xero.

Xero offers a cloud-based accounting software platform for small and medium-sized businesses..