Making Tax Digital
Better use of information
HMRC will use information from third parties, such as employers, banks and other government departments so that individuals will not have to supply information themselves.
Tax in real time
HMRC will obtain and process information affecting tax as close to real time as possible, so that individuals and businesses no longer have to wait until after the end of the tax year to know how much tax they have to pay.
A single financial account
Taxpayers can now see a comprehensive picture in their digital account with all their tax information in one place.
Interacting digitally with customers
Customers (and agents) will be able to interact with HMRC digitally at a time to suit them.
New Deadlines for MTD for VAT
2019 saw the first roll out of this process with MTD for VAT. The two key requirements for this are:
- To keep transaction-level records digitally, and
- to use compatible software to submit VAT returns to HMRC.
These requirements were imposed on businesses that had turnover over the Vat limit which was £85,000 but is now to be extended to those who are voluntarily registered for VAT from April 2022.
Making Tax Digital for Income Tax
Whilst this was supposed to be introduced in 2023 the government announced on 23 September 2021 that there would be at least a 12 month delay. From 6 April 2024, ALL self-employed businesses and landlords with annual business or property income above £10,000 will need to follow new Making Tax Digital rules from their next accounting period starting on or after 6 April 2024.
This will represent a huge change for most businesses across the UK who currently have no formal records at all and get everything sorted once a year at the year end.
Don’t leave it late to decide how you will comply with the new requirements. We are here to help.
How Maynard Johns can help …
If your current bookkeeping method does not allow you to submit directly to HMRC through compatible software you need to start preparing. We have many solutions to help you.
Visit us in our Bideford office or give us a call!
Telephone 01237 472071