Will you join the MTD pilot launch?

This month we’re sharing more insight for the digitalisation of Income Tax Self Assessment (ITSA) and launch of a pilot scheme. But before we do…

VAT REGISTERED?

As we mentioned in our Making Tax Digital (MTD) update last month, MTD for VAT registered businesses with a taxable turnover below the threshold will go digital in April 2022. If you’re not prepared to submit returns digitally, please get in touch with us as soon as possible.

 

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INCOME TAX SELF ASSESSMENT

MTD for ITSA is scheduled to go live for self-employed businesses and landlords with annual business or property income above £10,000 in April 2024.

The majority of businesses and landlords with business or property income above £10,000 will be required to sign up for MTD for ITSA, and then use compatible software for their income tax accounting for the first full accounting period starting on or after 6 April 2024.

In other words, MTD for ITSA will affect those who would normally declare more than £10,000 in the self-employment or property boxes of the Self Assessment tax return.

This will involve:

• An electronic submission of summary totals for specified categories from digital records of each business on a quarterly basis from the software to HMRC.
• Updates are due from 10 days before, to one month after the quarter end date.
• No tax is paid at this point.
• HMRC returns a calculation of the estimated tax liability based on the information sent.
• End of period statements (EOPS) will be required to be completed and submitted at any point after the accounting period or basis period date and up to the following 31 January.
• Final declarations effectively replaces the SA100 tax return – 31st January continues to be the deadline for filing.