Making Tax Digital myth busted: Can taxi drivers still use spreadsheets under new HMRC rules?
- Perry Richardson
- 33 minutes ago
- 2 min read
Making Tax Digital for Income Tax (MTD IT) has begun changing how self-employed taxi and private hire drivers manage their tax records, but the introduction of digital reporting does not mean drivers must abandon spreadsheets.
MTD IT has applied since April 2026 to qualifying self-employed people and landlords with gross revenue above £50,000. The threshold is due to fall to £30,000 from April 2027 and £20,000 from April 2028, bringing significantly more drivers within the regime over the next two tax years.
One misconception emerging among drivers is that spreadsheets can no longer be used once somebody falls within MTD IT. According to Making Tax Digital specialists TaxNav, that is not the case.
TaxNav said: “No, HMRC does not ban spreadsheets under MTD IT.”
Drivers who already record fares, fuel expenditure, insurance premiums and other allowable business costs in a spreadsheet can therefore continue using that method. The important change is how those digital records connect with HMRC’s MTD IT system.
Drivers using spreadsheets will need compatible software capable of linking their records to HMRC and handling the required digital submissions. This type of product is commonly described as bridging software.
TaxNav said: “If you already use a spreadsheet to record your fares, fuel, insurance and other business costs, you can continue using it for MTD IT.”
The company added: “You’ll need to select HMRC-recognised bridging software to link your spreadsheet records to the MTD IT system.”
TaxNav offers one such option, allowing users to connect an existing spreadsheet or use spreadsheets provided by the company for MTD IT reporting.
For taxi and private hire drivers already comfortable maintaining digital records in Excel or similar spreadsheet software, the rules could therefore require less disruption than expected. Rather than moving their entire bookkeeping operation to a new accounting platform, drivers may be able to retain their existing record-keeping approach and add compatible software for the required HMRC connection and submissions.
The option is likely to become increasingly relevant as the income threshold falls. Drivers outside MTD IT during the current tax year could enter the regime from April 2027 or April 2028, depending on their qualifying income.
For affected drivers, the key consideration is not whether their records are held in a spreadsheet, but whether their record-keeping and submission process meets MTD IT’s digital requirements.
