The first quarterly submission deadline under Making Tax Digital for Income Tax has now passed. For UK accounting firms that have been managing the transition since April 2026, the practical reality of the new regime is no longer theoretical. Quarterly reporting means more touchpoints, more client communication, more data management, and more professional time spent per client, every single year.
Yet many firms are still charging the same annual fees they were charging before MTD arrived. If that describes your practice, you are almost certainly undercharging for the work you now do. More importantly, you are missing a genuine opportunity to restructure your pricing in a way that better reflects the value you deliver and creates a more sustainable commercial model for the years ahead.
This guide sets out a practical approach to repricing your practice for the MTD era: what to change, how to structure it, and how to have the conversation with clients.
Traditional accounting fees were largely built around the annual compliance cycle. A fixed annual fee, or a time-based charge, for preparing accounts and filing a Self Assessment return made sense when the client interaction was concentrated into a short window each year. The work was predictable, the scope was contained, and the fee reflected that.
MTD for Income Tax changes this structure fundamentally. A client who was previously a once-a-year engagement is now a four-times-a-year compliance obligation, with a Final Declaration on top. The quarterly submissions themselves require digital record review, data validation, and HMRC filing. For clients who are not yet fully confident with their bookkeeping software, there is additional support time on top of that.
Research published in 2026 suggests that accountant fees for MTD-affected clients are expected to increase by between 15% and 25% to reflect the additional workload. Nearly half of UK accounting firms are already planning to increase their prices for MTD clients. If you have not yet done so, you are absorbing a cost that your competitors are recovering.
The most effective pricing structure for the MTD era is a monthly recurring retainer rather than an annual fixed fee. This shift benefits both the practice and the client, and MTD creates the natural justification for making it.
For the practice, monthly retainers smooth income across the year, improve cash flow, and make revenue more predictable. They also reduce the risk of fee disputes, because the scope of service is defined and agreed in advance on a rolling basis rather than renegotiated annually.
For the client, a monthly retainer replaces a large annual invoice with a predictable, manageable regular payment. Many clients find this easier to budget for, and it removes the psychological sting of a single large bill. When the retainer is framed around the value delivered across the year rather than the hours spent, it is also easier to justify.
The transition from annual to monthly billing is straightforward in practice. Divide the total annual fee by twelve, adjust upward to reflect the additional MTD workload, and present it as a monthly service fee. Most clients accept this readily, particularly when it is framed as a convenience rather than a price increase.
A tiered service structure gives clients a clear choice and gives your practice a framework for pricing consistently across your client base. Three tiers work well for most practices:
Tiering makes the fee conversation easier because you are presenting a choice rather than announcing a price increase. Clients who are cost-conscious can select the core tier. Clients who value proactive advice will often self-select into the higher tiers, particularly once they have experienced the benefit of a quarterly review call.
The fee conversation is where many firms hesitate. It does not need to be difficult, but it does need to be handled thoughtfully. A few principles make a significant difference.
Lead with the change, not the number. Before you mention the new fee, explain what has changed. MTD now requires quarterly submissions, ongoing digital record management, and regular client contact throughout the year. The additional work is real and quantifiable. Clients who understand what is involved are far more receptive to a revised fee than those who simply receive a higher invoice without context.
Frame it as a service upgrade, not a price increase. You are not charging more for the same thing. You are offering a more frequent, more proactive service that keeps the client compliant year-round and gives them better visibility of their financial position. That is genuinely more valuable than the annual return model, and most clients will recognise it when it is explained clearly.
Give adequate notice. Send a formal communication to affected clients at least sixty days before the new pricing takes effect. This gives them time to absorb the change, ask questions, and make any decisions they need to make. Clients who feel ambushed by a fee change are far more likely to look elsewhere than those who have been given time to consider it.
Personalise the conversation for key clients. For your longest-standing or highest-value clients, a phone call or meeting is more appropriate than a letter. Use it as an opportunity to reinforce the relationship, not just to discuss pricing. Ask what their biggest financial concerns are for the year ahead. The answer will often reveal advisory opportunities that more than justify the revised fee.
Some clients will push back on fee increases, and it is worth being prepared for this. A few responses are worth having ready.
If a client questions why the fee has increased, return to the change in workload. Quarterly submissions require professional time four times a year rather than once. Digital record review, data validation, and HMRC authorisation management are ongoing rather than periodic. The fee reflects the actual service being delivered.
If a client says they will manage their own MTD submissions, acknowledge that this is possible for straightforward cases, but be clear about what that involves: choosing and maintaining compatible software, submitting accurate quarterly updates on time, and completing the Final Declaration correctly. Many clients who initially plan to self-manage return to their accountant after the first submission cycle.
If a client says they will find a cheaper provider, that is their right. But be honest with yourself about whether a client who will not pay a fair fee for a materially increased service is a client your practice can afford to keep. Research consistently shows that firms which raise fees in line with the value they deliver lose a small proportion of their client base but become more profitable overall.
The repricing conversation you are having now with Phase One clients is also preparation for Phase Two. From April 2027, the MTD income threshold drops to £30,000, bringing a significantly larger group of clients into scope. For most practices, this cohort will outnumber the Phase One group.
These clients will need to be onboarded to MTD-compatible workflows, supported through the transition, and priced appropriately for the ongoing quarterly service. If your service tiers and pricing structure are already in place from Phase One, onboarding Phase Two clients becomes a repeatable process rather than a series of individual negotiations.
Start the repricing conversation with your Phase Two clients now, before the April 2027 mandation date. Clients who receive advance notice and a clear explanation of what MTD involves are far easier to onboard than those who are told about the change at the last minute.
MTD has changed the economics of accounting practice. The quarterly compliance cycle creates more work per client, but it also creates more contact, more data, and more opportunities to deliver value. Firms that price their services to reflect this reality will build practices that are more profitable, more sustainable, and better positioned for the continued expansion of the MTD regime in 2027 and 2028.
The repricing conversation is not just a commercial necessity. It is an opportunity to reposition your practice as a proactive, high-value partner rather than a once-a-year compliance provider. Clients who pay for a quarterly service expect quarterly value, and delivering it consistently is what turns a compliance relationship into a lasting advisory one.
TaxCalc's practice management and MTD software is designed to support practices through every stage of this transition. From managing quarterly submissions across your entire client base to the workflows that make a tiered service model operationally practical, our tools are built for the way accounting firms need to work in the MTD era. Get in touch with our team to find out how TaxCalc can help your practice work smarter and grow more sustainably.