It was announced this last week that Making Tax Digital for Income Tax will start from April 2023.
This will apply to Sole Traders, Partnerships and Landlords with turnover (or rental income) over £10,000, who will need to:
- Submit returns of income and expenses quarterly
- Submit an annual end of year return – so five returns a year
- Use MTD compatible software for their accounts and returns
- From April 2022 all VAT registered business will be inside MTD for VAT – at present its only those over the VAT registration limit, so this brings in those who are voluntarily registered for VAT.
- No date set for MTD for Corporation Tax
This news has been expected for a while – its been when not if – and as a firm its on our radar how we will help and guide clients. Nothing to do yet, although if you don’t already use software for your accounts, you will need to start doing so, and it maybe a good idea to do this from April 2021 or April 2022 – we recommend FreeAgent for most of our clients, but are open platform so will work with your choice of software where possible.