Making Tax Digital (MTD)

As you may well have already heard in the press, the Government is rolling out “Making Tax Digital”.

This is broadly the collection of data by HMRC via digital means and they are starting the process by making changes to the way in which VAT returns are submitted.

From 1 st April 2022 if you are VAT registered and over the VAT registration limit, all VAT returns must be generated and submitted through an electronic accounts package such as Sage, Xero, Quickbooks etc.

If you are already preparing your accounting records via one of these methods, then compliance with these new rules will be a straightforward process.

If, however, you currently prepare your accounting records by some other means and directly input those numbers via the HMRC website as you have been doing for a number of years, then this will not comply with the new rules from 1 st April 2022 onwards.

It is important, therefore, that if you are in this second category that you put in place the software and systems to enable your business to file its VAT returns compliantly and this process needs to start as soon as possible as it could be well be that you already started your last VAT return period which can be submitted under the “old system”.

For Individuals and Landlords HMRC will be extending the scope of MTD to include Income Tax Self Assessment (ITSA) reporting from April 2024, this applies if total gross income from self-employment and property exceeds £10,000 in a tax year.

If you require any advice on the various options available in terms of software and also options with regard to processing your accounting information using that software, then please contact Jeff Oliver on 01992 554444.

Require more information?

If you would like more information or would like to speak to us direct then call us on 01992 554444. Or if you would prefer, ask us a question online.