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Can I keep using a spreadsheet for MTD? Bridging software explained

By Paul · Last checked against GOV.UK on · How we check facts

Short answer: yes. A lot of sole traders and landlords already keep their income and expenses in a spreadsheet, and Making Tax Digital for Income Tax doesn't make you throw it away. You do need a second piece of software to talk to HMRC, and you need to follow a few rules about how the two are linked.

The two kinds of MTD software

HMRC describes two types of compatible software:

  • software that creates your digital records (you type or import transactions into it)
  • software that connects to records you already keep, such as a spreadsheet

The second type is the one HMRC says is "sometimes referred to as 'bridging software'". It reads the totals from your spreadsheet and sends them to HMRC.

Source: Choose the right software for Making Tax Digital for Income Tax, GOV.UK

Check it does the whole year, not just the updates

Under MTD you send quarterly updates and then a tax return through compatible software. HMRC says some bridging products let you do both. Not all of them do.

If a product only sends quarterly updates, you'll need something else for the tax return. You can use more than one product, but HMRC says they need to work together, and you can only use one product for each submission. Its example: a landlord can't use two different products to send their property quarterly updates.

HMRC also says some products are free but may have limits, such as how many transactions you can record.

Source: Choose the right software for Making Tax Digital for Income Tax, GOV.UK

This is the bit people trip over. If your records are in one place and your bridging software is another, the two have to be digitally linked. HMRC lists ways that count, including:

  • linked cells or formulas in a spreadsheet
  • emailing a spreadsheet so it can be imported into other software
  • giving someone a pen drive or memory stick so they can import the data
  • CSV or XML import and export, or uploading and downloading files
  • automated transfers, or an API connection

And once a record has been sent to HMRC in a quarterly update, you must not move it by hand. HMRC gives two examples of what's not allowed: writing the figure out again in another cell or product, and cut and paste or copy and paste.

So a summary tab that pulls its totals from your transactions tab with a formula is fine. Retyping the totals into a new tab is not.

Source: Use Making Tax Digital for Income Tax: create digital records, GOV.UK

What each row needs

Each digital record needs three things: the amount, the date, and a category. MTD uses the same income and expense categories as Self Assessment.

There's a simpler option if a business has turnover under £90,000. A sole trader only needs to record whether each transaction is income or an expense. A landlord with residential property income also has to mark any expense that's a restricted finance cost. If your turnover reaches £90,000, you'll need to categorise that income source in full, and HMRC suggests full categories if you're not sure you'll stay under.

You also still keep your original records, like bank statements and invoices, the same as now.

Source: Use Making Tax Digital for Income Tax: create digital records, GOV.UK

Fixing a mistake

If you spot an error, HMRC says to correct it in your spreadsheet and then link the records to your bridging software again. Each quarterly update covers the tax year so far, so the fix flows into your next update.

Sources: Create digital records and Send quarterly updates, GOV.UK

If you switch products later

You can change software at any time, though HMRC says the end of a tax year is often easier. If you change bridging software part way through a year, you link the new product to your spreadsheet. Either way, keep your digital records for at least 5 years after the submission deadline. For 2026 to 2027 that means until at least 31 January 2033.

Source: Use Making Tax Digital for Income Tax: if your circumstances change, GOV.UK

How to find a bridging product

HMRC's software finder lists products that have been through its recognition process. It asks whether you want to create new records or connect to ones you already keep. HMRC is clear that it "does not recommend any product or software provider", so check a few against what you need. It also suggests choosing your software before you sign up.

My software chooser puts the free options first and asks if you already use a spreadsheet. Not sure when you start? The free checker takes about a minute.

What I'd do if I were keeping my spreadsheet

  1. One row per transaction, with date, amount and category columns.
  2. A separate tab for each business. All your UK lets count as one property business, so they can share a tab.
  3. Totals worked out by formula, never typed in.
  4. Try the bridging product on last quarter's numbers before your first real update.

Sources

We checked each of these on GOV.UK on 3 November 2026. If HMRC changes them, this page will change too.

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This page is general information, not tax advice. Read why. Page history: 3 November 2026, full check against GOV.UK.

Drafts are sometimes prepared with help from AI writing tools. Every fact is checked against the GOV.UK page it links to, and Paul reads and approves each page before it goes up. How we check facts.

Quotes and facts from GOV.UK: contains public sector information licensed under the Open Government Licence v3.0. Quoted words are HMRC's or HM Treasury's, not ours.