Behind every tax deadline is an ocean of details.
Your clients see deadlines met, tax bills in order, books in order, and payroll running smoothly.
But the reality is different. You are managing ever-changing tax laws, keeping up to date with evolving HMRC guidelines, reconciling errors, juggling multiple systems and handling endless back-and-forth communications. And that’s just a sample of what happens.
In this article, we explore how AI is helping to shape and improve these challenges.
This is what we discussed:
The Impact of Agent AI on Compliance
The way accountants handle compliance is undergoing a fundamental change.
As new technologies like agent AI emerge, the manual and repetitive tasks that once defined compliance are being eliminated.
One of the clearest examples of this transformation is Making Tax Digital (MTD). It’s no secret that MTD is reshaping the UK’s tax landscape and the next wave is just around the corner in April 2026.
While this brings new challenges, this time you’ll have something extra on your side: agent AI.
Here’s how Georgina Timothy, director of product management at Sage for Accountants, sums up agent AI for accountants:
MTD will be more than a digital filing requirement – it is a fundamental change to how taxes are filed and how data flows between HMRC, accountants, bookkeepers and their clients.
By April 2026, sole traders and landlords with qualifying gross income over £50,000 must comply, and by 2028 that threshold is reduced to £20,000, bringing in thousands more.
This expansion brings with it quarterly shipments and more frequent data touchpoints, which could leave room for more errors.
While this change may seem like a compliance headache for both you and your clients, it is also a strategic opportunity for your practice.
As compliance becomes more focused on reviewing rather than entering information, agent AI can step in to transform the process.
MTD will become a reality, but it will bring with it the opportunity to simplify and automate.
Georgina Timothy, Director of Product Management, Sage for Accountants
Why agent AI is important to MTD
Unlike generic AI, agent AI will not be limited to automating tasks. It will adapt, anticipate and support in real time.
These tools help you stay compliant, reduce administration, and deliver more value. Here’s how:
- Real-time categorization: Transactions are properly tagged at the point of entry, reducing the need for year-end cleanup.
- Error detection and correction: The AI reviews the submitted data, flags anomalies, and can even suggest or apply corrections.
- Workflow automation: From receipt capture to quarterly submissions, AI can streamline the entire MTD process.
- Customer information: AI provides actionable feedback, helping clients understand their financial situation and tax obligations.
Beyond simply digitizing tax returns, MTD can also be seen as an opportunity to reshape the relationship with its customers.
MTD is not a one-size-fits-all solution, so there will be some clients who will simply rely on you to file their final return and others who will want you to handle everything from start to finish.
Agentic AI adapts to each of these scenarios, helping you manage your workload no matter how your clients prefer to work.
Traditionally, most administrative time is spent finding clients for missing information and reviewing records. Agent AI should bring advisors and small businesses more closely together with deeper and more regular collaboration.
It will help you:
- Capture information correctly at the source
- Automate customer follow-up and document collection.
- Free up more time for deeper, more frequent collaboration.
The result? Stronger relationships, richer conversations, and greater customer trust.
Selecting the right AI tool is one of the most important decisions your practice will make as the MTD for income tax approaches.
The right tool will not only help you comply. It will transform the way you work and your efficiency.
That’s where the Sage MTD agent comes into play.
Sage MTD Agent combines the trusted functionality of Sage with completely new capabilities to optimize every stage of MTD, from first customer registration to final shipment.
Instead of relying on click menus to complete each step, MTD Agent handles multiple interconnected tasks at once, anticipating what needs to be done, organizing information, and flagging anomalies.
Here you will find everything you need to know:
- Less admin: You have up to 80% less administration thanks to intelligent task automation.
- Automated customer segmentation: Instantly identify which clients are ready for MTD and then add readiness tasks to a shared list that can be assigned to team members and set to repeat.
- Quarterly presentation reports: Automatically extract data from digital accounting records to write quarterly reports for HMRC review and filing.
- Proactive document search: If information is missing, the agent can contact customers via email, WhatsApp, or in-app notifications.
- Optimized efficiency: Benefit from 40% less manual invoice handling and an average saving of 5 hours per week.
Even with all of these advanced capabilities, you have maximum control. You can decide:
- Which clients to work with and when
- The level of automation for each workflow.
- Whether the agent simply prepares tasks or completes them completely.
Tax is rapidly becoming digital and compliance is no longer a box-ticking exercise – it is about accuracy, efficiency and insight. With the MTD deadlines approaching, practices that now embrace AI will be best placed to thrive.
Final thoughts
Agent AI is not here to replace accountants. It is designed to support you, anticipate what needs to be done and keep you firmly in control.
If you’re ready to future-proof your practice and help your clients navigate MTD with confidence, now is the time to explore how Agentic AI can support every step of the journey.
The Accountant’s Guide to Making Taxes Digital for Income Tax
Download this free interactive guide to develop your practical approach to making taxes digital for income tax.
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