VAT and cashflow
Making Tax Digital for Income Tax: what it means for you
Making Tax Digital, or MTD, is HMRC's long-running shift towards digital record keeping and more frequent reporting. It already applies to VAT, and it is being extended to income tax for many sole traders and landlords. Here is what it means in plain terms.
What is changing
Under MTD for Income Tax, affected sole traders and landlords will need to keep digital records and send updates to HMRC more regularly through compatible software, rather than filing a single annual return. The aim is more frequent, more accurate reporting.
Who it affects
The rules are being phased in based on income from self-employment and property, starting with higher levels of income and extending over time. Whether and when it applies to you depends on your circumstances and the latest timetable, which is worth confirming rather than guessing.
How to prepare
- Move to compatible cloud accounting software in good time
- Get into the habit of keeping records digitally and up to date
- Make sure you understand your reporting obligations before they begin
Want this applied to your own numbers?
Book a free 30-minute call and we will tell you, honestly, where your biggest tax wins are.
Get ready ahead of time
The businesses that find MTD easiest are the ones already on good cloud software with current records. Getting set up early turns it from a worry into a non-event.
Every business is different, and the right move depends on your full financial picture. Book a free 30-minute call and we will tell you, honestly, where your biggest tax wins are.
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