mtd-records

---
name: mtd-records
description: Turns your till or EPOS export, your bookkeeping software or spreadsheet, and a plain account of how data moves between them into a written Making Tax Digital position: a mandation test naming which regime, VAT MTD, Income Tax MTD or both, already applies to you and from what date, a records inventory naming every record HMRC's rules require against what you actually hold and how, a digital links map naming every point data moves from one system to another and whether that move is digital or manual, a functional compatible software fitness check, a gaps register, and a dated action list built from the owner's own plan. Use when you are setting up or changing till or bookkeeping software, moving records between systems, working out whether Making Tax Digital for Income Tax now applies to you, or you cannot say in writing which of your systems are digitally linked.
---

# A written record of which Making Tax Digital rules already apply to you, and where your current systems fall short

You give this your EPOS or till export, the bookkeeping software or spreadsheet you use, your VAT registration status, your self-employment or property income figures for the relevant tax years, and a plain description of how a sale or an invoice actually travels from the point it happens to the return that gets filed. You get back a mandation test that says, on the figures you supplied, whether VAT MTD, Income Tax MTD, both or neither currently apply to you, a records inventory that lists every record HMRC's own rules require and marks whether you hold it digitally, a digital links map that traces every point data moves between systems and marks each move digital or manual, a software fitness check against the three things HMRC's rules say software must do, a gaps register, and a dated action list built entirely from what you tell it you plan to do. It will not recommend a specific till, bookkeeping or bridging software product as the right one for you, because that choice depends on your supplier contracts, your bank feed and your accountant's own systems, none of which a document can weigh for you. It will not state what proportion of independent hospitality businesses are currently non-compliant, because no such published figure exists for a single business, and the figures that do circulate come from firms selling bridging software.

## What it does

1. **Work out which Making Tax Digital regime already applies to you, and from what date.** Two regimes run on different tests and it is common for a small hospitality business to sit inside one and outside the other. For VAT, the rule is simple: the Register for VAT guide states you must register if "your total taxable turnover for the last 12 months goes over £90,000 (the VAT threshold)" or you expect it to in the next 30 days, and every business that has been VAT registered since 2019 has been under Making Tax Digital for VAT the whole time, there is no remaining transition period. For Income Tax, the current guidance on when you need to use Making Tax Digital for Income Tax is explicit about the two mandation groups already announced: anyone whose qualifying income for the 2024 to 2025 tax year was over £50,000 "should've started using Making Tax Digital for Income Tax from 6 April 2026", which means this regime is already live for that group as this is written, and anyone with qualifying income over £30,000 for the 2025 to 2026 tax year "will need to use it from 6 April 2027". A third group, over £20,000 for the 2026 to 2027 tax year, is due from 6 April 2028. It applies to a sole trader or a landlord registered for Self Assessment, not to a limited company, whose profits sit under Corporation Tax rather than Income Tax. Record the owner's turnover and qualifying income figures, the tax year each one relates to, and the date the figures were supplied, because a mandation test built on a guess is worse than no test at all.

2. **Enumerate the specific records each regime actually requires, from the rules that create the duty rather than from a supplier's marketing page.** For VAT MTD, Notice 700/22 sets out designatory data and two record classes with the force of law: the designatory data is "your business name, the address of your principal place of business, your VAT registration number, any VAT accounting schemes that you use", the record of each supply made must carry "the time of supply, the value of the supply, rate of VAT charged", and the record of each supply received must carry "the time of supply, value of the supply, amount of input tax that you'll claim". For Income Tax MTD, the current guidance is narrower than most owners expect: "You or your agent will need to create and store digital records of your self-employment and property income and expenses", and nothing else, meaning other income such as savings interest or dividends is reported on the return but does not need a separate digital record. Write both lists out in full before looking at a single till button, because a records inventory built by reading the EPOS screen first inherits whatever the supplier decided to log and proves nothing about what the rules actually require.

3. **Build the records inventory against the population from step 2, one row per required field.** For every designatory data item and every supply record field under VAT MTD, and every income and expense category under Income Tax MTD if it applies, record whether it is currently held, whether it is held digitally, which system holds it, and since when. A field marked as held "on paper" or "in my head" is not a digital record whatever the reason, and the honest entry is "no", not a workaround. This is the step that turns a vague sense of being organised into a list that either covers the population or visibly does not.

4. **Trace every point data moves from one system to another, and name the method, not just the fact that it moves.** A typical small hospitality business has several: till to bookkeeping software, bookkeeping software to a spreadsheet for the accountant, a spreadsheet to bridging software, bridging software to HMRC. For each one, name the origin system, the destination system, and exactly how the data gets there: an API connection, a CSV export and import, linked spreadsheet cells, an emailed file, a memory stick, or someone typing the weekly total from the till receipt into a spreadsheet by hand. The last one is the case this step exists to catch, because it is also the most common in a small kitchen and the one least likely to be written down anywhere.

5. **Apply the digital link test itself to every row in the map from step 4.** Notice 700/22 states the rule plainly: "A digital link does not need any manual intervention, such as the copying over of information by hand", and it rules out the workaround owners reach for first: "HMRC does not consider the use of 'cut and paste' or 'copy and paste' to select and move information, as a digital link." A digital link does include "linked cells in spreadsheets, for example, if you have a formula in one sheet that mirrors the source's value in another cell". So a till total retyped into a spreadsheet is not a digital link and never becomes one by being retyped carefully; a formula that pulls the same figure across automatically is. Mark every row in the digital links map "digital", "manual" or "not verified", and treat "not verified" as a gap rather than a pass, because a claimed connection nobody has traced is not evidence of one.

6. **Check whether each system in the map actually meets the functional compatible software test, not just whether it is popular software.** Notice 700/22 sets out three duties software must perform to count: it must "record and preserve digital records", it must "provide HMRC information and returns from data held in those digital records, using the API platform", and it must "receive information from HMRC, using the API platform". The notice is also explicit that this does not have to sit in one program: "The complete set of digital records to meet Making Tax Digital requirements does not have to be held in one place or in one program... a business can maintain their electronic account across more than one piece of software, as long as these products are digitally linked." So a spreadsheet that only records is not disqualifying on its own, it becomes a compliance problem only where it is not digitally linked to something that files.

7. **Where a spreadsheet sits in the chain, check specifically whether it is connected to bridging software or is standing alone.** HMRC's guidance on finding software that works with Making Tax Digital for Income Tax describes this route directly: software "will connect to existing records kept in spreadsheets or other accounting tools", and this class "is sometimes referred to as 'bridging software'". A spreadsheet with no bridging software behind it can still be a perfectly good set of digital records for the recording duty in step 6, but it has no route to the sending duty, and the gap is not the spreadsheet, it is the missing connection.

8. **Note the one place a manual step is genuinely allowed, so it is not flagged as a false gap.** Notice 700/22 carves out adjustments: "If the adjustment requires a calculation, this calculation does not need to be made in functional compatible software. If the calculation is completed outside of functional compatible software, digital links are not required for any information used in the calculation." A partial exemption calculation or a flat rate scheme adjustment worked out on paper and then entered as a single figure is not a digital link failure. Record which figures in the map, if any, are adjustments of this kind, with the calculation named, so the gaps register does not penalise something the rules explicitly permit.

9. **Hand the finished facts to Codex and let it build the registers.** Claude hands over the mandation figures and their dates, the full records population from step 2 against what step 3 found, the complete digital links map from step 4 marked digital, manual or not verified, the software fitness answers from step 6, the bridging software position from step 7, the adjustment exceptions from step 8, and the owner's own plan for closing any gap, with a date if one was given. Codex makes no judgement at all: it tabulates what it is given, counts it, and writes anything unanswered into the gaps list. Run it from the folder holding the exports:

   ```
   codex exec --sandbox danger-full-access --skip-git-repo-check -C "<working folder>" - < CODEX.md
   ```

   What comes back is the mandation test, the records inventory, the digital links map, the software fitness check, the gaps register and the action list, plus the counts you check in the next section.

10. **Read the retention rule against the systems just mapped, and date the whole file.** For Income Tax MTD, the current guidance sets the length in plain terms: "You will need to keep your digital records for at least 5 years after the 31 January submission deadline for a tax year." Record that date against the oldest digital record the map found, so it is visible whether the current system, and not just the current owner's memory, will still hold that record when it is five years old. Put the date every figure was supplied and the date this file was built in the footer, because a mandation test is only as good as the tax year it was worked out against, and a business grows past £30,000 or £50,000 of qualifying income quietly, often mid-year, with nobody deciding to cross the line on purpose.

## Then it checks

1. Every designatory data item and every supply record field required by VAT Notice 700/22 paragraph 3.3 appears in the records inventory with a held-digitally answer of yes, no or not stated, and no row is left blank.
2. Every income and expense category Income Tax MTD requires digital records for, where that regime applies, appears in the records inventory in the same way.
3. Every point data moves from one system to another in the digital links map is marked digital, manual or not verified, and every row marked manual or not verified also appears in gaps.md.
4. The mandation test states, for both VAT MTD and Income Tax MTD, whether it applies, from what date, and the figure and tax year it was worked out from, with no regime left unanswered.
5. Every system named anywhere in the digital links map is tested against all three functional compatible software duties, and any duty not met is named against that system.
6. Any spreadsheet appearing in the map states explicitly whether it is connected to bridging software, and a standalone spreadsheet with no stated connection is listed in gaps.md.

Any check fails: name it, redo that step once. Failed twice: say what is wrong and stop.

## Rules
- Public information only.
- Never invent a fact, a number or a quote.
- Anything sent in someone's name says whose name it is.
- Never state what proportion of independent hospitality businesses are compliant, non-compliant, or use any particular till, bookkeeping or bridging product, and never state a typical cost of becoming Making Tax Digital compliant for a single independent business. No published figure exists for one business, and the numbers that circulate come from software vendors marketing the very products the owner is being asked to buy.
- Never recommend a specific till, bookkeeping or bridging software product as the right choice. State what a product must do against the functional compatible software test and leave the purchase decision to the owner and their adviser, who know the supplier contracts and the bank feed already in place.
- Never mark a digital link as digital on a supplier's claim alone. Only a data flow the owner can point to, an export file, a visible API connection, a spreadsheet formula that can be opened and read, supports a digital answer. Anything else is recorded as not verified, and not verified goes in the gaps register rather than being read as a pass.
- Never treat Making Tax Digital for Income Tax as applying to a limited company. It applies to a sole trader or a landlord registered for Self Assessment; a limited company's own profits are taxed under Corporation Tax, though a director with rental income held personally can still be brought into scope in their own name.
- Never carry forward a mandation threshold, a tax year figure or a retention period from memory or from this document. Read the current gov.uk or HMRC page on the day it is used, and record the date it was read, because a threshold that is correct today can move at the next Budget or fiscal event.
- This output is a working document prepared for the owner's own accountant, bookkeeper or tax adviser to check before any till, bookkeeping software or bridging product is bought or changed, and before relying on any mandation date to decide when to act. It applies published HMRC rules to the systems the owner described. It is not tax advice, it is not a confirmation that HMRC will accept the records as compliant, and it is not a ruling on when the owner must join Making Tax Digital.

## Built from
- HM Revenue and Customs, "VAT Notice 700/22: Making Tax Digital for VAT", https://www.gov.uk/government/publications/vat-notice-70022-making-tax-digital-for-vat/vat-notice-70022-making-tax-digital-for-vat, the page states "Updated 1 April 2022", read 23 September 2026: paragraphs 3.2 and 3.3 on functional compatible software and designatory data and supply records in steps 2, 3 and 6, paragraphs 3.2.1 and 3.3.1 to 3.3.3 on digital links and the record fields in steps 4 and 5, and paragraph 3.4 on the manual calculation exception in step 8.
- HM Revenue and Customs, "Find out if and when you need to use Making Tax Digital for Income Tax", https://www.gov.uk/guidance/find-out-if-and-when-you-need-to-use-making-tax-digital-for-income-tax, the page states it was last updated 26 March 2026, read 23 September 2026: the qualifying income thresholds and mandation dates for the 2024 to 2025, 2025 to 2026 and 2026 to 2027 tax years, and the sole trader and landlord scope, in step 1.
- HM Revenue and Customs, "Create digital records" (part of Use Making Tax Digital for Income Tax), https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/create-digital-records, the page states it was last updated 7 September 2026, read 23 September 2026: the definition of a digital record and the limit to self-employment and property income and expenses in step 2.
- HM Revenue and Customs, "Keep digital records" (part of Use Making Tax Digital for Income Tax), https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/keep-digital-records, the page states it was last updated 7 September 2026, read 23 September 2026: the digital linking duty between record-keeping and submission software in step 4, and the five year retention rule in step 10.
- HM Revenue and Customs, "Find software that's compatible with Making Tax Digital for Income Tax", https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax, the page states it was last updated 13 July 2026, read 23 September 2026: the description of bridging software and how it connects a spreadsheet to a submission route, in step 7.
- HM Revenue and Customs and GOV.UK, "Register for VAT", the When to register for VAT part, https://www.gov.uk/register-for-vat, read 23 September 2026: the £90,000 VAT registration threshold used to fix the VAT MTD starting point in step 1.

# mtd-records

## You are given
The owner's turnover for the last 12 months and, if given, their forecast for the next 30 days, for the VAT mandation test, plus their self-employment and property qualifying income figures for the 2024 to 2025, 2025 to 2026 and 2026 to 2027 tax years where supplied, each with the date the figure was given and whether the business is a sole trader, a landlord or a limited company. The full population of records VAT MTD and, where it applies, Income Tax MTD require, each marked by the owner as held digitally, held but not digitally, not held, or not stated, with the system name and the date it has been held since where given. A list of every system in use, such as a till or EPOS, bookkeeping software, a spreadsheet, or bridging software, each named exactly as the owner named it. A list of every point data moves from one system to another, each with the origin system, the destination system, the method used, and the owner's own judgement of whether that method is digital, manual, or not yet verified. For each system, the owner's answer on whether it records and preserves digital records, sends information to HMRC using the API platform, and receives information from HMRC using the API platform. For any spreadsheet in the chain, whether it is connected to bridging software and the product name if given. Any calculation the owner has marked as an adjustment carried out outside functional compatible software, with the calculation named. The owner's own plan for closing any gap, with a target date where one was given. All judgement calls, including which regime applies, whether a link is digital, and what the plan for each gap is, have already been made by the owner and are supplied to you.

## Produce
Write into a `./mtd-records-output/` folder:

1. `mandation-test.csv` with these columns in this order: `regime`, `threshold_gbp`, `owner_figure_gbp`, `figure_basis`, `figure_tax_year`, `date_figure_supplied`, `mandated`, `mandation_date`. `regime` is exactly one of `VAT MTD`, `Income Tax MTD (2024 to 2025 group)`, `Income Tax MTD (2025 to 2026 group)`, `Income Tax MTD (2026 to 2027 group)`. `figure_basis` is exactly one of `turnover last 12 months`, `turnover next 30 days forecast`, `qualifying self-employment and property income`. `mandated` is exactly one of `yes`, `no`, `not yet known`. One row per regime the owner supplied a figure for.
2. `records-inventory.csv` with columns: `record_ref`, `regime`, `required_field_verbatim`, `currently_held`, `system_name`, `held_since_date`, `evidence_supplied`. `record_ref` is R001 upward. `regime` is exactly one of `VAT MTD`, `Income Tax MTD`. `currently_held` is exactly one of `yes digitally`, `yes but not digitally`, `no`, `not stated`. `evidence_supplied` is `yes` or `no`. One row per required field per regime that applies.
3. `digital-links-map.csv` with columns: `link_ref`, `origin_system`, `destination_system`, `data_type_moved`, `method`, `digital_or_manual`, `date_confirmed`. `link_ref` is L001 upward. `method` is exactly one of `API`, `CSV export and import`, `linked spreadsheet cells`, `XML import or export`, `portable device transfer`, `manual re-key or cut and paste`, `other named by owner`. `digital_or_manual` is exactly one of `digital`, `manual`, `not verified`.
4. `software-fitness-check.csv` with columns: `system_name`, `duty`, `met`, `evidence_supplied`. `duty` is exactly one of `record and preserve digital records`, `send information and returns to HMRC using the API platform`, `receive information from HMRC using the API platform`. `met` is exactly one of `yes`, `no`, `not stated`. `evidence_supplied` is `yes` or `no`. Three rows per system.
5. `action-list.csv` with columns: `gap_ref`, `gap_description_verbatim`, `owner_planned_action_verbatim`, `target_date_supplied`, `responsible_party_supplied`. `gap_ref` matches the numbering in `gaps.md`. Any field the owner did not supply is left empty, never filled in.
6. `gaps.md` a numbered list of: every record in `records-inventory.csv` marked `no` or `not stated`; every link in `digital-links-map.csv` marked `manual` or `not verified`; every row in `software-fitness-check.csv` marked `met` as `no` or `not stated`; every spreadsheet in the chain with no bridging software connection stated; every mandation figure supplied with no date; and every gap in `action-list.csv` with no owner plan and no target date.

## Rules
- Codex tabulates, counts and cross-references. It never decides which Making Tax Digital regime applies, never marks a link digital or manual on its own judgement, never estimates a missing record, a missing date or a missing figure, and never proposes what the owner should do about a gap. Those were supplied.
- A field with no supplied answer is written exactly as `not stated` or left empty as the column specifies, and is always counted in `gaps.md`. It is never inferred from the system name, the regime or any other row.
- Never write a typical compliance cost, a typical proportion of compliant businesses, or any other industry benchmark into any file. No such figure exists for a single independent UK business and none is to be recorded.
- Never carry a mandation threshold, a retention period or any other figure forward from a previous run or from this file. Use only the figures supplied for this run.
- Use British English, GBP written as `GBP` or the pound sign, and DD Month YYYY dates. No em dashes in any file you write, and any supplied text containing one is recorded verbatim and flagged in `gaps.md`.
- Every system name, product name and owner-supplied phrase is copied exactly, including its punctuation and capitalisation.
- Every file ends with this line: this is a working document prepared for the owner to check against their own accountant, bookkeeper or tax adviser before any till, bookkeeping software or bridging product is bought or changed, and before relying on any mandation date. It applies supplied facts to published Making Tax Digital rules and is not a ruling that the records held are compliant or that any mandation date is correct.

## Return
The absolute path of every file written, the row count of each CSV, the mandation conclusion for each regime found in `mandation-test.csv` stated in full with the figure and date it rests on, the count of records in `records-inventory.csv` marked `no` or `not stated`, the count of links in `digital-links-map.csv` marked `manual` or `not verified` and which systems they sit between, the count of software duties in `software-fitness-check.csv` marked `no` or `not stated` and which systems they belong to, the count of spreadsheets with no bridging software connection, and the `gaps.md` item count.