Making Tax Digital
MAKING TAX DIGITAL (MTD) FOR SELF-ASSESSMENT
MTD for ITSA Update
On 19 December 2022 HMRC announced that MTD for ITSA (Income Tax Self-Assessment) was to be delayed until April 2026.
This was originally scheduled to commence from April 2024 for anyone with self employed / rental income exceeding £10,000 per annum.
As well as the delay HMRC have now re-set the parameters for compliance with MTD for ITSA. From April 2026 any individual who has self-employed income or a rental property portfolio, with a gross turnover above £50,000 will need to comply with the new reporting regulations. This limit will drop to include anyone earning more than £30,000 per annum from self-employment or rental income in April 2027.
It was also announced that the planned qualification for MTD ITSA for general partnerships would no longer apply, although this may be re-visited in the future.
For more detailed information regarding MTD for ITSA please see our FAQ’s and the Government guidance link (left) or contact us at the office.
(Updated November 2022)
In July 2020 HMRC announced their plans to introduce Making Tax Digital (MTD) to the self-assessment system. This follows on from MTD for VAT registered business which is now in full swing. The general idea of this new system is to increase the speed and efficiency of self-assessment information to HMRC.
WHAT IS MTD?
Any individual with either self-employment turnover, or total rental income exceeding £10,000 (or a combination of both) in the tax year to 5th April 2023 must file their income and expenditure records digitally to HMRC via accounting software from April 2024 on a quarterly basis. This is in addition to the usual year-end tax return submissions. There is currently no requirement to change the way you pay your tax to HMRC, although this may change in the coming years.
This system is now being trialed and it may make sense to adopt this method early in order to get used to the processes involved. There are also advantages of keeping your records digitally (if you don’t do this already) through software such as accuracy of records and time saving.
HOW CAN WE HELP?
Our team are able to assist you in any the following ways (dependent on your individual needs/circumstances):
- Initial set up and linking to HMRC for Making Tax Digital for Self-Assessment
- Writing up of your records onto our own accounting software to comply with the new rules
- Quarterly submission of your income and expenditure figures to HMRC
- Recommendation of the best software an apps to suit your individual requirements
- Provide set up and training to you for use to operate your own accounting software
For further information on how we can assist you please contact us on 0115 9608412 or email firstname.lastname@example.org