Making Tax Digital (MTD) has been the key driver behind HMRC in the last few years. Digital record keeping and submissions for all businesses is seen as the future ...
The delay to MTD For ITSA will be welcomed by many, but it's still going to happen!
Requiring digital quarterly reporting for self-employed and rental income by individuals with a gross income above £10,000 was due to start in April 2024, however it was recently announced that this would be delayed by another two years.
"Businesses are facing a challenging economic environment!"
With an unstable economy, huge inflation and many businesses not fully recovered from the pandemic, HMRC and the Treasury have taken the decision to delay Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) for another two years. This also means MTD for partnerships and companies will also be delayed, but they haven't made an announcement about this yet.
The scope for MTD for ITSA has also changed:
Individuals with a total of £50,000 or more gross income from self-employment and rental will need to keep digital records from April 2026
Those with self-employment and rental income between £30,000-£50,000, will be within MTD from April 2027
For those under £30,000 there will be a review by the Treasury about an implementation date
Individuals can join MTD voluntarily if they wish.
HMRC let the cat out of the bag themselves before making a formal announcement by updating their website. Even after they removed the guilty web page, rumours were flying so it forced them to make it official.
It is obvious that MTD for ITSA will be introduced, so keep it in mind. There will be a time when all self-employed individuals, landlords, partnerships and limited companies will be submitting quarterly returns and paying their taxes at the same time, so be sure your accounting and bookkeeping software is up-to-date and MTD capable.
It's a welcome delay for many, but it is also important to plan for it.
Until next time ...
HELEN BEAUMONT
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA), it may be a great idea to give me a call on 01908 774323 and let's see how I can help you.
Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.
Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.
When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.
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