Making Tax Digital Update
Posted in January 2023
Important news! The Government recently announced the date for the phased mandate of Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) for Landlords and the Self-Employed, has been changed from April 2024 to April 2026
From April 2026 therefore, landlords and the self-employed individuals with an income over £50,000, will be required to keep digital records and provide quarterly updates on their income and expenditure to HMRC through MTD-compatible software. However, those with an income of between £30,000 - £50,000 will need to get this done from April 2027.
The Government has also announced a review into the needs of smaller businesses, in particular those with an income that comes under the £30,000 threshold. It will consider how MTD for ITSA can be utilised to meet the needs of these smaller businesses and the best way for them to fulfil their Income Tax obligations.
This recent announcement by the Government relates to MTD for ITSA only. MTD for VAT has already been implemented.
Under MTD for ITSA, businesses, self-employed individuals and landlords will keep digital records, and send a quarterly summary of their business income and expenses to HMRC using MTD-compatible software. In response to this, they will receive an estimated tax calculation based on the information they have provided, to help them budget for their tax. At the end of the year, they can add any non-business information and finalise their tax affairs using MTD-compatible software. This will replace the need for a Self Assessment tax return.
At David Andrew we can help by collecting your rent, submitting your 1.4 returns or managing your property on favourable terms. For further information and to discuss your requirements, please contact our Property Management Office on Tel: 020 7354 9222 at 235 Blackstock Road, London N5 2LL, or email theo@davidandrew.co.uk. We look forward to hearing from you!
This information has been updated from the previous Making Tax Digital blog posted on the David Andrew website in December 2022.
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