Making Tax Digital (MTD)
Making Tax Digital is a government initiative designed to modernise the tax system by simplifying how income and financial data are reported using digital platforms.
As announced in the press, HMRC is rolling out MTD in stages, beginning with changes to the way VAT returns are submitted.
From 1st April 2022, if you’re VAT registered and exceed the registration threshold, all VAT returns must be generated and submitted through an electronic accounts package such as Sage, Xero, or QuickBooks.
If you already use one of these digital tools to manage your accounting records, complying with the new requirements should be straightforward. However, if you’ve been manually entering figures via the HMRC website, this method will no longer meet compliance standards from 1st April 2022.
To stay compliant, it’s essential to implement the appropriate software and systems now, especially if you’ve already started your final VAT return period under the “old system”.
Looking ahead, from April 2024, Making Tax Digital will extend to Income Tax Self Assessment (ITSA) for individuals and landlords whose total gross income from self-employment and property exceeds £10,000 per tax year.
If you’d like advice on choosing the right software or need help processing your accounting information digitally, please contact Jeff Oliver on 01992 554444. If you have any other questions or queries on Making Tax Digital, then please feel free to get in touch!
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.
