MTD Health Check – Is Your Business Fully Making Tax Digital Compliant?
Not Sure If You’re Fully MTD Compliant?
Many businesses assume that once they’ve registered for Making Tax Digital and started submitting returns digitally, they’re fully compliant.
But compliance goes far beyond submissions.
We regularly review businesses that are filing VAT returns through software — yet still fall short of HMRC digital requirements.
If you’ve ever asked yourself:
- Am I MTD compliant?
• Are my records structured correctly?
• Is my software fully linked to HMRC?
• Could I face penalties without realising it?
You’re not alone.
Our MTD Health Check service is designed to answer those questions clearly — through a structured compliance audit.
What an MTD Compliance Check Actually Covers
An MTD compliance check is a full review of your digital reporting environment.
It assesses whether your systems, records, submissions, and workflows align with HMRC’s Making Tax Digital framework.
This isn’t just a surface review.
We analyse:
- Software configuration
• Digital record structures
• VAT reporting accuracy
• Submission pathways
• Digital link integrity
The goal is to identify risks before HMRC does.
Why Businesses Need an MTD Health Check
Many compliance risks aren’t obvious day to day.
For example, businesses may be:
- Using compliant software — but configured incorrectly
• Filing VAT returns — but with broken digital links
• Recording transactions digitally — but missing audit trails
These issues may not block submissions — but they can still trigger penalties during compliance reviews.
An MTD health check identifies these hidden risks early.
Software Compliance Review
A major part of our audit focuses on your accounting software environment.
We review whether your system is:
- HMRC-recognised
• Configured correctly
• Linked to VAT submissions
• Maintaining audit trails
Even compliant platforms like Xero, QuickBooks, or Sage can create risks if configured incorrectly.
Digital Record Keeping Assessment
We review how your financial records are created, stored, and maintained.
This includes analysing:
- Income recording workflows
• Expense tracking systems
• Receipt storage processes
• VAT data structures
Our goal is to ensure your record keeping meets HMRC digital standards — not just internal bookkeeping needs.
Digital Link Testing
Digital links are one of the most misunderstood MTD requirements.
We test whether your financial data flows electronically between systems without manual intervention.
This includes reviewing:
- Bank feed integrations
• Spreadsheet links
• POS system connections
• Bridging software pathways
Broken digital links can invalidate compliance — even if submissions are filed successfully.
VAT Digital Audit — Deep Reporting Review
For VAT-registered businesses, we conduct a VAT digital audit.
This involves reviewing:
- VAT calculations
• VAT coding accuracy
• Adjustment handling
• Return submission histories
The audit ensures VAT filings align with underlying digital records.
Submission Pathway Testing
We test how submissions are generated and transmitted to HMRC.
This ensures:
- Software authorisation is active
• Submission APIs are functioning
• Filing workflows are structured
This technical review ensures filings can continue smoothly without disruption.
Risk Scoring — Measuring Your Compliance Exposure
After completing the audit, we assign a structured compliance risk score.
This score reflects:
- Record keeping accuracy
• Software configuration strength
• Submission integrity
• Digital link compliance
It provides a clear view of your exposure to HMRC enforcement risk.
Why Risk Scoring Matters
Risk scoring transforms compliance from guesswork into measurable insight.
It allows businesses to understand:
- Where vulnerabilities exist
• How urgent fixes are
• What improvements are needed
This structured view supports proactive compliance management.
Our MTD Health Check Process — Step by Step
Our compliance audit is structured to give you a clear, practical view of your Making Tax Digital position — not just a theoretical review.
We begin by gathering access to your accounting environment and reviewing how your digital reporting currently operates.
This includes analysing both your software systems and your internal bookkeeping workflows.
From there, we conduct a layered compliance assessment covering all key MTD reporting requirements.
Our review typically includes:
- Accounting software configuration analysis
• VAT submission pathway testing
• Digital record structure reviews
• Expense tracking process checks
• Digital link integrity testing
• Historical filing reviews
Each layer is assessed against HMRC digital compliance standards.
Bookkeeping & Record Accuracy Review
Beyond software setup, we review the accuracy and structure of your bookkeeping records.
This includes assessing:
- Transaction categorisation
• VAT coding consistency
• Expense allocations
• Income recognition timing
• Adjustment handling
Strong bookkeeping accuracy is essential — because MTD submissions rely entirely on underlying records.
Historical Filing & Submission Analysis
We also review past submissions to identify any hidden compliance risks.
This includes:
- VAT return submission accuracy
• Filing deadline adherence
• Amendment histories
• Payment alignment
Historical reviews help identify patterns that could trigger HMRC scrutiny.
Compliance Gap Identification
Once reviews are complete, we identify compliance gaps across your reporting environment.
Common findings include:
- Incorrect VAT scheme setup
• Broken digital links
• Incomplete audit trails
• Expense misclassification
• Spreadsheet reliance without bridging software
Identifying these gaps early allows businesses to fix issues before penalties arise.
Risk Scoring & Compliance Rating
Every health check concludes with a structured compliance risk score.
This scoring reflects:
- Software compliance strength
• Record keeping accuracy
• Submission reliability
• Digital infrastructure integrity
Your rating provides a clear picture of whether you are:
- Fully compliant
• Partially compliant
• High-risk
This clarity removes guesswork from your compliance position.
Detailed Compliance Report
Following the audit, you receive a structured compliance report outlining our findings.
This includes:
- Identified risks
• Compliance breaches
• Improvement recommendations
• System optimisation advice
The report is written in plain English — not technical jargon — so you can act on it confidently.
Fix Implementation Support
If compliance gaps are identified, we don’t just highlight issues — we help resolve them.
Our support may include:
- Software reconfiguration
• VAT scheme corrections
• Digital link rebuilding
• Bookkeeping restructuring
• Submission pathway fixes
This ensures your business moves from risk exposure to full compliance.
Preventing Future Penalties
An MTD health check isn’t just about reviewing the present — it’s about protecting your future reporting position.
By identifying risks early, businesses can avoid:
- Late submission penalties
• VAT reporting errors
• Digital record fines
• HMRC compliance reviews
Prevention is always more cost-effective than correction.
Ideal Timing for an MTD Compliance Check
Businesses typically request a health check when:
- Recently registered for VAT
• Migrated to new software
• Switched accountants
• Received HMRC letters
• Unsure about digital compliance
However, proactive reviews are recommended even without compliance concerns.
How We Help Businesses Stay Fully Compliant
Our MTD health check is delivered by specialists who work daily within HMRC digital reporting frameworks.
We combine:
- Technical software expertise
• Tax compliance knowledge
• Bookkeeping oversight experience
This ensures reviews are both technically accurate and commercially practical.
Frequently Asked Questions — MTD Health Check
What is an MTD health check?
A compliance audit reviewing your digital tax reporting systems.
Do I need one if I already submit VAT returns?
Yes — submissions alone don’t guarantee compliance.
Will you review my software setup?
Absolutely — configuration is a core review area.
Do you test digital links?
Yes — including integrations and data transfers.
What happens if issues are found?
We provide a report and fix implementation support.
How long does the audit take?
It depends on system complexity — but follows a structured review process.
Ready to Check If You’re Fully MTD Compliant?
If you’re unsure whether your digital reporting systems meet HMRC standards, a compliance review is the safest way to gain clarity.
Audit Consulting Group will:
- Audit your digital reporting systems
• Review VAT submissions
• Test digital links
• Assess record keeping
• Score your compliance risk
• Provide actionable recommendations
You’ll know exactly where you stand — and what to fix, if anything.
Speak with our team today and book your MTD Health Check.
