Getting Started: Eligibility and Access 

Will Sage 50 Accounts support Making Tax Digital for Income Tax?

The v33.1 release includes support for Sole Traders. We'll add Landlord support before the submission deadline, but we haven't confirmed the exact date yet.

Will there be enough time if you release the software in April as regulations start on 6 April?

The first quarter is from 6 April to 5 July, with a submission deadline of 7 August. You don't need to install the update by 6 April as the submission includes the quarterly transactions. This is whether you enter them in your current or updated Sage 50 Accounts.

Is this functionality available in all Sage 50 Accounts variants?

Yes. It will be available in Essentials, Standard, Professional, and Client Manager for subscription licence holders.

Can you use MTD functionality on a perpetual licence?

No. MTD for Income Tax features will be available only to subscription licence holders. We've excluded Perpetual licence products.

Will landlords be able to use Sage 50 Accounts for MTD Income Tax?

Yes. We’ll include this functionality in a future Sage 50 Accounts release to support UK property landlords.

Can I join the HMRC beta programme to submit Making Tax Digital for Income Tax through Sage 50 Accounts?

Direct customers can’t participate in the HMRC Making Tax Digital for Income Tax beta programme. If an Accountant is part of the beta and submitting via Sage Accounting or Individual, they can make a beta submission from Sage 50 Accounts.

How much effort is it to set up Making Tax Digital for Income Tax through Sage 50 Accounts?

It's a simple process, and we'll guide you through the necessary steps within the software. In summary, you need to enable the feature, ensuring you have also onboarded with HMRC. You then need to map your profit and loss nominal codes to Income Tax categories. You then just process transactions as normal and when the time comes, submit the quarterly update. 

Quarterly Update Submissions

Will you be able to submit quarterly updates to HMRC from Sage 50 Accounts?

Yes. The software supports native submission of quarterly updates directly to HMRC, for users in the scope of MTD Income Tax.

Does Sage 50 Accounts support submission of the annual Income Tax return?

A solution will be available for Sage 50 Accounts users to submit their annual return. The submission deadline for the first year is 31 January 2028, but you can submit from 6 April 2027. We'll have a solution ready well before this date. 

We'll provide this capability at no additional cost. Accountants can complete tax returns and manage their tax affairs via Sage for Accountants. We'll also launch a new personal tax app for small business users. This app will be cloud-based and included as part of subscriptions for all Sage 50 Accounts customers. 

Will Sage 50 Accounts integrate with HMRC to support both retrieving obligations and submitting quarterly updates for MTD for Income Tax?

Yes. This is what the integration includes:

• Retrieve obligations -  Sage 50 Accounts will connect to HMRC to retrieve all relevant obligations for the user's income source. For example, sole trade, UK property. It then shows them in the software. This is similar to how it handles VAT obligations
• Submit updates -  Users can submit quarterly updates directly to HMRC via Sage’s Network Compliance service. Use either Income Tax credentials for direct submissions, or ASA credentials for accountants submitting on behalf of clients
• Post-submission tax calculation - After submission, Sage 50 Accounts users can retrieve and view the tax calculation from HMRC

Features and Functionality

Can you map nominal codes to HMRC Income Tax categories?

Yes. The software allows mapping, with options to export / import the mappings.

Does the system help to reconcile quarterly updates?

Yes. Extra default reports and a native Quarterly Update form help you calculate and review submissions.

Can you classify individual transactions as allowable or disallowable for tax purposes?

No. We won't include transaction-level classification for allowable / disallowable expenses yet.

Is there error handling and audit trails?

Yes. Errors are displayed in a format with actionable steps, and all submissions will be auditable.

What about the annual return?

A solution will be available for Sage 50 Accounts users to submit their annual return. The deadline submission for the first year is 31 January 2028, we'll have a solution ready well before this date. We'll be in touch when we have news to share on this. 

Accountants and Client Management

Can accountants submit on behalf of clients?

Yes. Accountants using Client Manager can submit updates using ASA credentials, with full credential management support.

Further information

For more information, see our Making Tax Digital Help Centre and our Get ready for Making Tax Digital for Income Tax article.