HMRC’s Making Tax Digital (MTD) regime, which ultimately requires taxpayers to move to a fully digital tax system, now includes all VAT registered businesses, including those registered businesses under the threshold (currently £85,000). All applicable businesses should be compliant now and HMRC are being more active in chasing up those that are not.
The next stage, MTD for Income Tax & Self Assessment, will commence in April 2024. This will be for individuals with self-employment income and/or gross rental income from property greater than £10,000. They will need to report their business income quarterly with a final declaration at the end of the year. This is intended to replace the current self-assessment system.
If you are in the position where you have a rental business with rental income of more than £10,000 or a small self employment with income of more than £10,000 it is important that you consider how you are going to undertake the quarterly filing requirements and the requirement to maintain digital records.
General Partnerships are to be included from April 2025, whilst Corporation Tax is not expected until at least April 2026.
Your BrighterThinking Next Steps
“This is mandatory now for those businesses mentioned and over the coming years for the individuals mentioned. MTD compliance is now commonplace for most businesses and our advice for individuals would be to look at the available options to digitise sooner, so you are ready for when your enrolment date arrives.”
The benefits of cloud accounting and software can be huge, saving lots of time and costs and you will be ready and compliant for when your time comes. Your advisor at Menzies can have visibility too for more proactive advice to help you and your business.”Oliver Finch – Outsourcing Partner
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Menzies Private Client Team
Personal tax planning can be complex. We would always recommend that you seek professional advice when undertaking a review to ensure all changes are processed and managed effectively. Please do speak with your Menzies contact who will be delighted to meet with you to discuss ideas, opportunities and the appropriate action.