Making Tax Digital AI Prompts: HMRC & MTD Assistant

Last reviewed: October 2026. Rules and dates checked against GOV.UK. General information only, not tax advice.

Making Tax Digital (MTD) changes how UK businesses, sole traders and landlords keep records and report to HMRC. The rules are phased in, the terminology is dense and the dates matter, which makes it an easy topic for an AI assistant to get wrong. These ten prompts are designed to do three things: explain MTD in plain English, help you work out which rules might apply to you, and keep the AI tied to official GOV.UK guidance so you can check what it says.

Not tax advice. AI assistants can state dates, thresholds and rules incorrectly and with great confidence. Use these prompts to understand and prepare, then confirm every deadline and requirement on GOV.UK or with a qualified accountant before you act.

MTD at a glance (checked October 2026)

| Part of MTD | Who | Start | |—|—|—| | MTD for VAT | All VAT-registered businesses | In force since April 2022 | | MTD for Income Tax | Sole traders and landlords with qualifying income over £50,000 | 6 April 2026 | | MTD for Income Tax | Qualifying income over £30,000 | 6 April 2027 | | MTD for Income Tax | Qualifying income over £20,000 | 6 April 2028 |

Qualifying income means your total gross income from self-employment and property before expenses, not your profit. Whether you are in scope is based on an earlier tax return: the 2024/25 return for April 2026, the 2025/26 return for April 2027 and the 2026/27 return for April 2028. HMRC guidance, thresholds and exemptions can change, so confirm the details on the official pages: Making Tax Digital collection, Sign up for MTD for Income Tax and Use MTD for Income Tax. For Corporation Tax, check the latest GOV.UK announcements before relying on any date.

How to get reliable answers

1. Tell the AI to use official sources and to say when it is unsure. The master prompt below does this.
2. Paste the official text when the answer matters. Copy the relevant section from GOV.UK and ask the AI to answer only from it.
3. Never rely on dates or thresholds from the AI's memory. Check them against the table above and GOV.UK.
4. Keep personal identifiers out. Do not paste your National Insurance number, UTR, VAT number or bank details. Use labels such as "Business A" and rounded figures.

The prompts

1. Master prompt: an MTD assistant

Use this as your starting point for any MTD question.

Act as a UK tax educator who explains Making Tax Digital (MTD) clearly and carefully. You are not a registered accountant and you do not give personal tax advice.

Rules:
1. First work out whether my question is about MTD for VAT, MTD for Income Tax, or something else. If it is unclear, ask me one question before answering.
2. Do not state dates, thresholds, rates or penalties from memory. If I have not pasted current GOV.UK text, tell me which GOV.UK page I should check.
3. Explain in plain English, define technical terms, and use short headings and bullet points.
4. End with a "What to check" list of the specific points I must confirm on GOV.UK or with a qualified accountant.

About me: [sole trader / landlord / limited company / VAT-registered business]
My question: [your question]

2. Explain MTD in simple English

Explain Making Tax Digital to a small business owner who has never heard of it. Use friendly, plain English. Give: (1) a two-sentence summary, (2) who it affects now and who it affects later, (3) the three things I should do first, and (4) a short glossary of any technical terms, using an everyday analogy for each. Do not state specific dates or thresholds. Tell me where to check them on GOV.UK.

3. Which MTD rules might apply to me?

I want to understand which Making Tax Digital rules might apply to me. Ask me up to six questions, one at a time, about my situation (for example whether I am VAT-registered, whether I am self-employed or a landlord, and where to find my gross income on my latest tax return). Then summarise which parts of MTD I should look into and which GOV.UK pages to check. Do not decide my legal status for me.

Facts so far: [business type, roughly how long you have traded]

4. Quarterly updates for sole traders and landlords

Explain how quarterly updates work under Making Tax Digital for Income Tax, for a [sole trader / landlord]. Compare them with my current annual Self Assessment routine: what I send, how often, what I still need to do after the tax year ends, and what changes in how I keep my records. Use a step-by-step timeline, and list the exact points I should confirm on GOV.UK because dates and rules can change.

5. Digital records and digital links

Explain the difference between "digital records" and "digital links" in Making Tax Digital, using plain English and one real-world example of each. I use [software or spreadsheet names]. Create a checklist for my setup that shows where data moves between tools, and flag any step where I type or copy-and-paste figures by hand. Tell me which GOV.UK guidance covers digital links so I can confirm the rules.

6. Keeping your spreadsheets

I am not comfortable with technology and I currently keep my records in a spreadsheet. Explain the simplest compliant route to Making Tax Digital. Can I keep using a spreadsheet? What is "bridging software", in plain English? What should I ask a software supplier before I buy? Do not recommend specific products. Point me to the official list of software that works with MTD on GOV.UK.

7. Answer only from official guidance

This is the safest prompt when accuracy matters.

Answer my question using ONLY the official text below. Quote the sentence you rely on for each point. If the text does not answer part of my question, say "not covered in the text" instead of guessing.

Official text (pasted from GOV.UK): [paste the section]
My question: [your question]

8. A 12-month compliance calendar

Create a 12-month planning calendar for my MTD obligations based on this information: [business type, VAT-registered yes or no, accounting period or tax year]. Show the kinds of tasks to do each month (for example keeping records up to date, reviewing figures and preparing updates). Mark every date as "to confirm on GOV.UK" instead of stating it as fact.

9. Questions to ask your accountant or software provider

I need to prepare for a conversation with my accountant about Making Tax Digital. Based on this description of my business: [description], write a list of ten practical questions I should ask about the start date that applies to me, record-keeping, software, who submits updates, fees, and what happens if I fall behind. Keep each question short.

10. Exemptions and difficulties

Explain in plain English the idea of an exemption from Making Tax Digital, for example for people who cannot use digital tools for reasons such as disability, age or location. Tell me what kinds of circumstances HMRC may consider, and what I should do first. Do not say whether I qualify. Point me to the official GOV.UK page about applying for an exemption so I can read the current rules.

What AI can and cannot do here

| AI is useful for | AI is not reliable for | |—|—| | Explaining jargon and the overall process | Exact dates, thresholds and penalties | | Organising questions for your accountant | Deciding whether you are legally in scope | | Making checklists and calendars to review | Choosing software without current official lists | | Rewording official text more simply | Giving advice that you can rely on if HMRC challenges you |

Common mistakes

• Trusting remembered dates. Training data can be out of date. Check GOV.UK.
• Confusing the parts of MTD. MTD for VAT and MTD for Income Tax are separate, with different rules.
• Using profit instead of qualifying income. The threshold is based on gross income.
• Pasting identifiers. Keep your UTR, NI number and bank details out of chat.

Frequently Asked Questions

Is Making Tax Digital mandatory?

For VAT-registered businesses it already is. For Income Tax it applies to sole traders and landlords whose qualifying income is above the threshold for the relevant year, as set out above. Confirm your position on GOV.UK.

What counts as qualifying income?

It is your total gross income from self-employment and property before expenses. Employment income and other income do not count towards it. Check the GOV.UK guidance for how it is measured.

Are quarterly updates the same as a tax return?

No. They are short summaries of your income and expenses sent during the year. After the year ends you confirm your final figures with HMRC. Check GOV.UK for the current requirements.

Do I need special software?

You need software that works with Making Tax Digital, or an agent who uses it for you. Use the official GOV.UK list of compatible software rather than relying on an AI's recommendation.

Can ChatGPT replace my accountant?

No. It can help you understand the rules and prepare, but it cannot take responsibility for your filings.

Related

Read How to Fact-Check AI Answers, try the Prompt Improver skill, and see the Research Brief Builder for structuring tax research.