What is a Bridging Solution?

A bridging solution is software that connects existing record-keeping methods (such as spreadsheets) to HMRC’s MTD system. Rather than replacing current processes, a bridging solution “bridges the gap” by:

  • Taking financial data from spreadsheets or other formats.

  • Converting it into the correct format for HMRC.

  • Submitting the required quarterly updates and end-of-year declaration directly to HMRC.

This means businesses and individuals who prefer using spreadsheets or their current systems can remain compliant with MTD without needing to change their entire setup.


What Details Must Be Recorded in the MTD Bridging Software?

HMRC requires that certain data is captured digitally before it is submitted. The bridging tool must record:

  • Taxpayer information: Name, National Insurance number, Unique Taxpayer Reference (UTR).

  • Property and business details: Identifying which income source relates to which business or property.

  • Quarterly income and expenses: A digital record of the categories required by HMRC, including:

    • Turnover / business income

    • Allowable business expenses (e.g., travel, office costs, stock, professional fees)

    • Property income (if applicable)

    • Property-related allowable expenses (e.g., repairs, letting agent fees, utilities)

  • Adjustments: Any accounting adjustments needed before submission.

  • Final declaration details: At year-end, the total figures for all sources of income and expenses, plus any claims for allowances and reliefs.

By maintaining these details digitally, the bridging tool ensures that submissions meet HMRC’s compliance requirements.


What Information Needs to Be Uploaded into the Capium Template?

To comply with MTD IT requirements, you’ll need to ensure the following details are entered into the Capium bridging template:

  1. Invoice number – a unique reference for each transaction.

  2. Party Name – the customer, supplier, or other party linked to the transaction.

  3. Invoice date – the date the transaction took place.

  4. Transaction Type – whether the entry is an Income item or an Expense item.

  5. Transaction Name – the category of the transaction (e.g., turnover, cost of goods, travel, repairs, office expenses).

  6. Amount – the value of the transaction in pounds sterling.

  7. IsDisAllowable – indicate whether the expense is allowable for tax (Yes/No).


The template is attached to this article.

Capium’s Support for Bridging Software

At Capium, we understand that many firms and their clients are not ready to abandon spreadsheets entirely. That’s why we’re committed to supporting MTD IT bridging software as part of our product suite.

Our bridging solution will allow:

  • Seamless submissions: Upload data from spreadsheets and submit directly to HMRC.

  • Compliance assurance: Meet MTD requirements without overhauling existing processes.

  • Flexibility: Support both clients who want to transition to full digital accounting and those who prefer a hybrid approach.


Questions & Answers


Q: In terms of invoice numbers, what about transactions where there isn’t a formal invoice, such as buying tools from Selco? Likewise, landlords are not going to raise formal invoices, especially if fully managed. What should be entered into this space?


Capium: An invoice number is not mandatory under HMRC rules. However, for record-keeping and statutory compliance, we recommend entering a unique reference number for each transaction – even if there is no formal invoice – to help maintain a clear audit trail.


Q: Do HMRC receive any of the backing data, or just the totals?


Capium: HMRC only receives the totals. The detailed transaction data remains with you and within our system.


Q: Is this cumulative – does the client keep adding to the spreadsheet each quarter and start a new one each year – or do they start fresh each quarter?


Capium: We provide a sample spreadsheet template that can be downloaded via the application. For each quarter, the client should use the same spreadsheet but only enter transactions relevant to that quarter. The historical data is stored in the application on a quarter-by-quarter basis.


Next Steps

Capium’s MTD IT bridging solution will be available ahead of HMRC’s rollout in 2026. We invite firms to take part in our pilot programme and be among the first to test our tools.


For more information and to register interest in the pilot, please reach to our support team. More information can be found here: https://capium.freshdesk.com/a/solutions/articles/9000270918?portalId=9000044273