Article
How can technology drive efficiencies for my business?
With recent research showing that embracing digital tools could reduce rather than increase overall costs for Small and Medium Sized Businesses (SMBs), we look at why online accounting solutions are a must in 2026.
Last updated 3 Jun 2026 | First published 19 Apr 2023
By Helen Wood, CA 4 min read
Making Tax Digital
Self Employed
Online Accounting
Directors' Series
Limited Companies
There’s no doubt that things have changed at a pace in recent years. In the era of digital transformation, speed and efficiency rule. At the heart of that lies technology – it connects and improves how people, systems and organisations function together.
Why does my business need to go digital?
With Making Tax Digital (MTD) for income tax now underway, alongside MTD for VAT, many businesses have either already or are about to make the switch to digital bookkeeping and tax solutions. Once your business reaches the threshold to join MTD for income tax, it becomes a mandatory requirement rather than a choice.
Some business owners are concerned that starting to use digital tools will be a big investment of both money and learning time, taking them away from their core business.
However recent research by Starling suggested that SMBs adopting those tools for processes such as bookkeeping, invoicing and tax returns could actually save time and money to invest back into their businesses.
TaxAssist Accountants work with major software providers such as QuickBooks and Xero and can help you find the right package and solution.
Is cloud accounting software the foundation of business efficiency?
Cloud accounting software’s role is to maximise efficiency. For instance, if you already work with an accountant you’ll know that much of their work hinges on receiving the correct paperwork. That requires a fair amount of admin – time and effort that can otherwise be automated.
How do invoicing and payment tools help me to get paid faster?
When you automate your invoice management, you save yourself plenty of time – and headaches – by removing the need to manually create and send them to your customers. Faster issuing of invoices means faster payments from your customers. Automated follow-ups help to reduce late payment days.
Invoice tools also guarantee consistency, making you and your business look more professional.
What about expense management systems?
Expense management is difficult when receipts and other key paperwork go missing. The fix is automated data extraction. These tools allow you to easily scan, categorise and store receipts, invoices and bank statements from your phone. Expense management tools such as Dext can be used on your smartphone and laptop and integrate with bookkeeping solutions such as QuickBooks or Xero in-house, or you can then send this data straight to your accountant, ready to be published to your accounting software.
It means there’s far less back and forth between either you and your employees or you and your accountant, and reduces the delays associated with lost paperwork.
Accounting for digital commerce
If you run an online business or use in-store point-of-sale systems (POS), it can be difficult to keep track of transactions from multiple channels. Luckily, accounting technology can meet the specific demands of digital commerce, allowing you to easily split out sales, fees and refunds – and allocate the right taxes, whatever the region.
The main benefit of this technology is the reduction in time to get complete information to your accountant.
Managing the costs – is the investment worth it?
Starling’s research found that many SMBs thought that digital tax software, such as solutions for MTD for income tax, would cost around £12,000 per year. This is an overestimate by at least 15 times. MTD for income tax software is also typically payable monthly, avoiding the big upfront investment some SMBs have feared and can be as little as £10 a month for sole traders.
How does technology help businesses work with their accountants?
The benefits of technology in accounting
1. Better decision-making: With up-to-date financial information, reports and insights, business owners can empower themselves or their accountant to make more informed decisions about their business.
2.Improved accuracy: Accounting software can provide real-time visibility into a business’s financial position, which can help to identify and correct errors more quickly.
3. Enhanced security: Software ensures better security than keeping manual paper records as data is often stored using bank-level encryption – reducing the risk of loss or theft. These also include automatic backups, which help to ensure financial records aren't lost in the event of a disaster or system failure.
4. Easy access: Instead of sifting through folders of paperwork in search of one transaction, you or your accountant can use software to search for that data instantly.
5. No-fuss co-operation: With cloud-based accounting software, you and your accountant can streamline how you work together without the need for in-person meetings or having to physically drop off your documents.
Get in touch with TaxAssist Accountants today
Cloud-based accounting technology is a brilliant way to both streamline the work between you and your accountant, as well as reducing any potential risks. Digital bookkeeping solutions are facilitators, automating routine tasks and freeing up your time, but they can never replace professional human advice. Your business is unique rather than generic and needs to be treated as such. To find out more about accounting technology, call us on 01438 340111 or get in touch via our contact form today for expert advice on what technology is best for you.
Frequently Asked Questions
Making Tax Digital (MTD) is HMRC's programme to digitalise the UK tax system. MTD for VAT is already mandatory for all VAT-registered businesses. From 6th April 2026, MTD for income tax became mandatory for sole traders and landlords with annual income above £50,000. This threshold will fall to £30,000 in April 2027 and £20,000 in April 2028. Affected businesses must use HMRC-recognised software to keep digital records and submit quarterly income and expense updates to HMRC. If your income is below the current threshold, you are not yet required to comply, but adopting digital tools now is recommended to avoid a last-minute scramble.
You need software that is recognised by HMRC as compatible with Making Tax Digital (MTD) for income tax. HMRC maintains an up-to-date list of compatible software products on GOV.UK, including a personalised software finder tool. Compatible software must be able to create and store digital records of your income and expenses, submit quarterly updates directly to HMRC, and support your end of year tax return submission. Bridging software is also available if you prefer to continue using spreadsheets. It connects your existing records to HMRC's systems. A TaxAssist Accountant can help you choose the right solution for your business.
Software subscriptions used for business purposes are generally considered an allowable business expense, which means the cost can be deducted from your taxable income, reducing your tax bill. For sole traders, allowable expenses are deducted from self-employment income before calculating income tax. For limited companies, software costs are typically deducted from the company’s profits before corporation tax. Tax rules can be complex and depend on your individual circumstances. You should speak to a qualified accountant to confirm what expenses are allowable in your specific situation.
Traditional accounting software is installed on a single computer and stores data locally. Cloud accounting software is accessed via the internet and stores data securely on remote servers. The key advantages of cloud accounting for small businesses are that you can access your records from any device with an internet connection, your accountant can view your records in real time, the software updates automatically to stay HMRC-compliant and data is backed up automatically, reducing the risk of loss. Most HMRC-recognised Making Tax Digital (MTD) for income tax software is cloud-based. Cloud solutions typically offer higher security standards than desktop software, including automatic encryption and two-factor authentication.
Technology can save small business owners considerable time across several areas. Cloud accounting software automates bookkeeping and tax submissions. Automated invoicing tools send invoices and payment reminders without manual intervention. Payroll software calculates PAYE and submits Real Time Information (RTI) to HMRC automatically. Cloud collaboration tools allow teams and accountants to share documents and work remotely. Expenses apps let you photograph receipts and categorise costs on the go. Together, these tools can reduce weekly admin time and help you maintain accurate, up-to-date financial records, which is increasingly important as HMRC expects more regular digital reporting.
Reputable cloud accounting and business software providers use enterprise-level security measures to protect your data. These typically include end-to-end encryption, automatic data backups, two-factor authentication, and compliance with UK data protection (GDPR) requirements. The National Cyber Security Centre (NCSC) recommends cloud-based solutions as generally more secure than storing records on a local computer, which can be vulnerable to hardware failure, theft, or ransomware. When choosing any cloud software, check that the provider is GDPR-compliant and stores data on UK or EU-based servers. A TaxAssist Accountant can advise on reputable, HMRC-recognised software options.
Last updated 3 Jun 2026 | First published 19 Apr 2023
This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.
Helen Wood, CA
Helen is a qualified chartered accountant (CA) and joined TaxAssist in 2025 following three years as a freelance content writer for clients in the tax and accounting publishing sector. Prior to this, She spent 17 years at Big Four and Top 10 accountancy firms. Helen writes clear and helpful articles on tax and accounting for businesses and individuals.
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