With only 18 months left to comply, it’s really important that you make sure your business is MTD compliant. It’s best to make sure you have everything in place sooner rather than later.
Are you self-employed, a partnership or a landlord with a property income above £10,000? You will need to follow the rules for Making Tax Digital (MTD) for income tax. This will be from your next accounting period starting on or after 6th April 2024.
Making Tax Digital (MTD) is a government initiative to modernise HMRC’s tax system. The aim is to make the whole process of administering tax simpler and more efficient. All of your tax information will be in one place (your digital account). You’ll be able to pay taxes based on your business activity during the year. You’ll also be able to upload and update your tax account in real time.
If you own a business or are self-employed and pay income tax, national insurance, VAT or corporation tax, you’ll most likely be affected. This means you’ll be required to keep digital records using an MTD compatible software and update HMRC at least quarterly via your digital tax account. Eventually, this will abolish the annual tax return. This will be law and there will be penalties for non-compliance.
Making Tax Digital (MTD) for income tax should become law from 6th April 2024. It will apply to the self-employed and partnerships. It will also apply to landlords who receive income from property, with gross income from these sources combined above a threshold of £10,000.
The government is running a pilot scheme where businesses can use the online service for Making Tax Digital (MTD) for Income Tax.
Click on the link below:
What should I do about MTD?
Talk to us! The good news is that you can reduce your running costs and streamline your accounting by complying with the rules!
In the last couple of years we have worked with many clients to help them comply with MTD and streamline their accounting.
Using accounting software will give you a clearer picture of your business and in real time! Your bank feeds data directly into your accounts on a daily basis. You can take a photo on your phone of a purchase invoice and it is posted automatically. You can see your results, who owes you money, who you owe money to and your business bank balance 24/7 from your smartphone.
Using accounting software means your accounts are 100% online. So there’s no software to install and everything is backed up automatically.
If you’re ready to get MTD compliant and need a little help, give us a call today. We can give you pointers or have a sit down with you and go through it together. Either way it’s best to get it sorted sooner rather than later.