What the new HSBC-Sage banking tool could mean for your MTD prep

HSBC UK and Sage have announced a new tool, My Business Finances, which aims to help sole traders and landlords prepare for Making Tax Digital for Income Tax (MTD ITSA).

The key shift is where the service lives. It brings invoicing, basic bookkeeping and MTD submissions into the HSBC business banking experience, rather than relying on a separate accounting system.

This matters because the first deadline for MTD ITSA is close, and it changes how often you need to keep your records in order – not just how you file.

The key deadline

MTD ITSA is being phased in for people who file Self Assessment as sole traders and landlords.

• From 6 April 2026, it applies if your qualifying income is over £50,000, based on the 2024 to 2025 tax year.

• From 6 April 2027, it applies if your qualifying income is over £30,000, based on the 2025 to 2026 tax year.

If you run a business that must switch to MTD ITSA, you'll need compatible software to keep digital records and submit updates.

HMRC's step-by-step guidance is the clearest reference point on what you must do and when.

What HSBC and Sage are offering

HSBC says the tool will let eligible business banking customers handle key finance admin tasks and MTD submissions in one place.

It's pitched mainly at sole traders and landlords, ahead of April 2026, and includes:

• invoicing and basic accounting inside HSBC business banking

• an estimated tax position, to help you plan for what you may owe

• the ability to send MTD updates and file to HMRC through the HSBC banking experience

Media reports present it as a practical attempt to reduce "app switching" and make MTD readiness feel less like a separate project.

Cost and access

HSBC says the service is for eligible HSBC UK business banking customers.

It will launch from April 2026, with an introductory free period then a monthly fee for MTD and insights tools, while invoicing stays free.

HSBC is also directing customers towards a registration of interest route ahead of launch.

Why small firms should take notice

For many microbusinesses, the hard part of tax returns isn't the final submission, but moving away from doing everything at year-end.

MTD ITSA pushes you towards keeping digital records as you go, using compatible software to produce quarterly updates and an end-of-year finalisation.

Sage is also using the announcement to highlight a readiness gap, citing research that many sole traders still rely on spreadsheets or paper and feel unprepared.

If accounting and tax admin sit inside your bank account, it may be easier to build the habit.

Many sole traders open their bank app far more often than they open an accounts package.

The implications

• MTD will become regular admin, not a once-a-year rush: If your business has to use MTD ITSA, you'll need a simple monthly routine. Keep on top of income and costs, and file them in the right categories. Software helps, but you still have to stay organised.

• "Simple" tools won't work for everyone: If you have more than one income stream, more than one trade or tricky property and expense rules, you may need an accountant or more capable software.

• Convenience can make it harder to switch: If your bank includes bookkeeping and tax filing, moving banks can feel like a bigger job. It's worth checking you can export your records easily and move them to another provider without hassle.

• This shows where things are heading: More banks and platforms will build tax admin into everyday tools. The ones that stand out will be the ones that are easy to use, have decent support and don't leave the smallest firms behind.

Enterprise Nation's view

We welcome anything that allows small business to cut their admin time and prepare for MTD without turning it into a major tech project.

A tool that sits inside existing banking apps or platforms could help some sole traders take a first step towards keeping digital records that keep to the law.

But two points matter if this shift is going to work for the wider small business population.

1. First, support must be broader than one provider's customer base. MTD will only succeed if founders can access simple, affordable ways to keep to the law, whether they bank with HSBC or not.

2. Second, choice must be protected through portability and switching. If embedded finance becomes the norm, small firms need to know they can change banks or software without losing history or creating a compliance headache.

How your small business can benefit now

If you're a sole trader or landlord, three practical actions will put you in a stronger position quickly.

1. Use HMRC's eligibility guidance to check whether you're in the April 2026 cohort.

2. Start keeping digital records in real time, even if you begin with the basics. Don't leave it until the end of the year!

3. Choose a route to staying legally compliant that fits how you work. If you bank with HSBC, look out for My Business Finances and read the terms carefully. If you don't, you'll still need MTD-compatible software when your business falls under the MTD rules.

People also read

• What Making Tax Digital for Income Tax means for sole traders

• What Making Tax Digital for Income Tax means for landlords

• Five things you need to know about MTD for Income Tax

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