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Zoho Books Making Tax Digital: MTD for Income Tax and VAT Setup

Techvaria sets up Zoho Books Making Tax Digital for UK sole traders, landlords and VAT-registered businesses.

At a glance

Techvaria sets up Zoho Books Making Tax Digital for UK sole traders, landlords and VAT-registered businesses. We configure the software, connect it to HMRC and train your team, working alongside your accountant. Techvaria is not a tax agent or accountant: your accountant remains responsible for tax advice and for what is submitted. We deliver remotely from our offices in Bangalore, Ahmedabad and Dubai, with calls held during UK mornings.

This page sets out the MTD thresholds and dates, the setup steps in Zoho Books, and how responsibilities split between us and your accountant.

Making Tax Digital in 2026: what applies to whom

There are two MTD regimes to keep apart.

MTD for VAT is already mandatory for VAT-registered businesses. If you are VAT-registered, you should already be keeping digital records and filing VAT returns through compatible software.
MTD for Income Tax applies from 6 April 2026 to sole traders and landlords with qualifying income above £50,000, above £30,000 from April 2027 and above £20,000 from April 2028. Check your position with your accountant or on GOV.UK.

From	Who must use MTD for Income Tax	Action in Zoho Books
6 April 2026	Sole traders and landlords with qualifying income above £50,000	Sign up with HMRC, set the business type, connect and start quarterly updates
April 2027	Qualifying income above £30,000	Plan setup during the 2026/27 tax year so records are digital from the start
April 2028	Qualifying income above £20,000	Same process; allow time for your accountant to confirm eligibility

Source: GOV.UK, updated 26 March 2026. Links are in the Sources list at the end of this page.

Zoho Books Making Tax Digital: is it HMRC-recognised?

Yes. Zoho Books is HMRC-recognised for MTD for Income Tax, available on all plans including Free. It works for sole traders and landlords, with the business type in Zoho Books set to Sole Trader or Landlord, and you must sign up for MTD for Income Tax with HMRC first. For MTD for VAT, Zoho Books connects to HMRC to submit VAT returns from your digital records, which is the requirement for VAT-registered businesses.

Because MTD for Income Tax runs on all plans, a landlord or sole trader can meet the requirement without moving to a paid edition. Businesses that also need inventory, projects or multi-currency invoicing will usually choose a paid plan for those features, not for MTD itself.

Zoho Books MTD setup: the steps

A Zoho Books MTD setup for Income Tax follows this order. Doing the steps out of sequence is the most common reason the connection fails.

Enrol with HMRC’s service. You, or your accountant on your behalf, sign up for MTD for Income Tax with HMRC. Zoho Books cannot connect until this is done.
Set up your Zoho Books organisation. MTD for Income Tax in Zoho Books needs the business type set to Sole Trader or Landlord. We set this up and confirm the MTD options are available for your organisation.
Set up income sources and categories. We map your self-employment and property income and expenses to the categories HMRC expects, so quarterly figures come straight from your records.
Connect Zoho Books to HMRC. You authorise the connection using your Government Gateway credentials. We guide the session but do not hold your HMRC login.
Connect bank feeds and import opening data. Bank feeds keep records current; opening balances come from your accountant’s last figures.
Quarterly updates. Each quarter, records are reviewed and the update is sent to HMRC from Zoho Books. Your accountant checks the figures before submission and handles the year-end final declaration.

For VAT-registered businesses, we also check VAT rates, the VAT scheme (standard, flat rate or cash accounting), the VAT return periods and the HMRC VAT connection.

Industries: who we set up for MTD

MTD for Income Tax lands on individuals, not companies, so the people we set up are mostly landlords and sole traders. The setup differs by sector.

Who	What we set up in Zoho Books	Point to check
Landlords	The Landlord business type, one profile per property, rent and expenses tagged to each property, recurring rent invoices and reminders	Zoho introduced its Landlord edition in July 2026 for sole owners of UK rental properties. Joint owners and overseas property owners are not yet supported, so check this before you rely on it.
Sole traders in trades and services	Self-employment income and expense categories, bank feeds, receipt capture, quarterly updates	Qualifying income is your total self-employment and property income before expenses, so trading and rental income are added together. Joint owners count only their share. Your accountant confirms the figure.
Construction subcontractors	CIS settings, invoices marked as covered by CIS so the deduction is calculated, CIS reports	In Zoho Books UK, CIS contractor tracking is on every plan; submitting CIS returns to HMRC starts on the Professional plan. HMRC deducts 20% for registered subcontractors and 30% for unregistered ones unless you hold gross payment status.
VAT-registered small firms	VAT rates, VAT scheme, return periods and the HMRC VAT connection	MTD for VAT applies already; MTD for Income Tax applies to the owner as well if they are a sole trader above the threshold

Letting agents who manage property for several landlords usually need more than accounting: tenancy records, safety certificate dates and maintenance jobs. That is a Zoho Creator or CRM build, covered on our Zoho Creator developer UK page.

What Techvaria does and what your accountant does

Task	Techvaria	Your accountant
Confirm whether MTD for Income Tax applies to you	No	Yes
Enrol with HMRC’s service	Guide the process	Yes, or you directly
Set up MTD for Income Tax in Zoho Books	Yes	No
Chart of accounts, categories, VAT settings	Configure	Review and approve
Bank feeds, invoice templates, user access	Yes	No
Import opening balances and data	Yes	Provide figures and sign off
Quarterly updates and VAT returns	Train your team on the process	Review figures, advise, submit or approve submission
Final declaration and tax advice	No	Yes

If you do not have an accountant, we will tell you so at scoping and suggest you appoint one before go-live. We do not file tax returns or give tax advice.

Payroll, hosting and data protection

Zoho Payroll is not available for the UK. UK payroll stays in a dedicated UK payroll tool such as BrightPay, and we integrate it with Zoho Books so payroll journals post correctly.

UK Zoho Books accounts are typically served from Zoho’s EU data centres in Amsterdam (primary) and Dublin (secondary), with UK hosting announced by Zoho. UK GDPR applies to the personal data in your books, so we sign a data processing agreement and work inside your Zoho account.

Moving from Sage desktop? Our Zoho migration services page explains how we plan and check a data migration. For wider Zoho work, see our Zoho partner UK page.

How delivery works

Techvaria is a Zoho Premium Partner, implementing since 2016, with 350+ implementations. Our offices are in Bangalore, Ahmedabad and Dubai (Techvaria IT Services LLC); we have no UK office. India is 4.5 hours ahead of BST and 5.5 hours ahead of GMT, so UK mornings overlap with Indian afternoons. Setup sessions and accountant calls are held in your morning, and configuration continues afterwards. Each client has a named consultant, and our wider approach is described on the Zoho implementation page.

Scoping and pricing

We quote in GBP after a short scoping call. A landlord with two properties and a VAT-registered wholesaler with stock are different jobs, so we do not publish fixed prices. The quote lists what we configure, what data we import, the training included and what your accountant needs to provide. Zoho Books licences, where you choose a paid plan, are separate.

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Frequently Asked Questions

Does Zoho Books work for MTD for Income Tax?

Yes. Zoho Books is HMRC-recognised for MTD for Income Tax, available on all plans including Free. It works for sole traders and landlords, and you must sign up for MTD for Income Tax with HMRC first.

When does MTD for Income Tax start?

From 6 April 2026 for sole traders and landlords with qualifying income above £50,000, above £30,000 from April 2027 and above £20,000 from April 2028.

Can Zoho Books file VAT returns under MTD?

Yes. MTD for VAT is already mandatory for VAT-registered businesses, and Zoho Books connects to HMRC to submit VAT returns from your digital records.

Are you our accountant or tax agent?

No. Techvaria is not a tax agent or accountant. We configure Zoho Books and work alongside your accountant, who remains responsible for tax advice and submissions.

Can Zoho run our UK payroll as well?

No. Zoho Payroll is not available for the UK. Payroll stays in a dedicated UK tool such as BrightPay, which we integrate with Zoho Books.

Is Zoho Books MTD software for landlords?

Yes. Zoho Books has a Landlord business type, available from the Free plan, for sole owners of UK rental properties. It tracks income and expenses per property and supports MTD for Income Tax. Joint and overseas property owners are not yet supported.

How long does setup take?

It depends on data volume and how quickly HMRC enrolment is completed. We give a timeline in the written scope after the scoping call.

Sources

GOV.UK, Find out if and when you need to use Making Tax Digital for Income Tax (updated 26 March 2026): https://www.gov.uk/guidance/find-out-if-and-when-you-need-to-use-making-tax-digital-for-income-tax
Zoho Blog, Making Tax Digital for Income Tax in Zoho Books (August 2025): https://www.zoho.com/blog/books/making-tax-digital-income-tax.html
GOV.UK, Work out your qualifying income for Making Tax Digital for Income Tax: https://www.gov.uk/guidance/work-out-your-qualifying-income-for-making-tax-digital-for-income-tax
Zoho Blog, Zoho Books introduces the Landlords edition in the UK (July 2026): https://blog.zoho.com/books/zoho-books-for-landlords.html
Zoho Books UK, Making Tax Digital for Income Tax help: https://www.zoho.com/uk/books/help/mtd-it/making-tax-digital.html
Zoho Books UK, pricing and plan features (CIS by plan): https://www.zoho.com/uk/books/pricing/
GOV.UK, Make CIS deductions and pay subcontractors: https://www.gov.uk/what-you-must-do-as-a-cis-contractor/make-deductions-and-pay-subcontractors

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