What are digital links and why do they matter for MTD?

A digital link is an electronic or automated transfer of data between software programs, such as a formula-linked cell, an export/import file, or an API connection — as opposed to manually retyping or copying and pasting figures by hand. Under MTD, once your transaction data is first entered digitally, it must stay digitally linked all the way through to your VAT (or Income Tax) submission, with no manual re-entry breaking the chain. Getting this wrong is a common compliance slip-up, so if your process involves several spreadsheets or systems, it's worth having an accountant check your workflow qualifies as fully digitally linked.