Making Tax Digital for Income Tax – what it means for you….creative77
You are hopefully aware by now that some mandatory changes are coming from HMRC as part of its Making Tax Digital (MTD) initiative.
This will affect businesses of all sizes and change the way that you manage your books and finances, and file future returns if this is something that we don’t already do for you.
If we do it will change the way we manage this for you too.
What actually is MTD? Basically, it is one part of the government’s plans to make it easier for individuals and businesses to get their tax right and manage their affairs digitally more efficiently and effectively in real-time.
“Avoidable mistakes” cost the government £8.5 billion in 2018 to 2019, so the idea is that digital records are much more accurate, reducing the amount of mistakes and taxes lost.
Making Tax Digital for Income Tax Self Assessment begins on 6 April 2024, it had been due to take effect in April 2023, but was postponed for a year in September 2021.
As of April 2024, it will affect millions of individuals who are self-employed and will change how they handle their taxes. It also affects landlords. Certain kinds of partnerships will be affected in April 2025.
However, it only affects businesses or individuals who have income above £10,000 across their businesses or property.
If you earn £10,000 or below then you’ll continue using the current Self Assessment system for now.
Not sure where to start or what to do next? This is where we can help.
For our clients who will be affected by this next phase of MTD we are holding a workshop session to discuss the changes, what software is available (free and paid for) and give you some initial points and support on where and how to start to implement this for you and your business.
You will receive an invite from us to join the workshop over the next week or so, but if you do have any questions before then please do not hesitate to get in touch. Or if you might like to join us purely out of interest, then please call the office on 01472 287387 or email Cara Portess firstname.lastname@example.org