Making Tax Digital (‘MTD’) for Income Tax Self Assessment
Self-employed businesses and landlords with annual business or property income above £10,000 will need to follow the rules for MTD for Income Tax from their next accounting period starting on or after 6 April 2023.
What this means is that these taxpayers will have keep digital records of all business income and expenses and submit updates to HMRC through an authorised software every quarter digitally as well as a statement at the end of the financial year. The updates sent to HMRC are the summaries of the business income and expenses.
How can I prepare for this?
You can start by ensuring that your accounting records are kept in accordance with MTD requirements, so that when this regulation comes into full effect you are ready. You will also need to make sure that you use an HMRC approved accounting software to be able to send HMRC the quarterly updates.
When to follow the rules?
You can opt to sign up now for the current or next accounting period voluntarily, or you choose to follow in the next accounting period that starts on or after April 2023.
For more information and advice about this proposal, get in touch with us via email email@example.com or call 01279 772966.