Set to take effect from April 2026, landlords and the self-employed must prepare for a significant change in the Making Tax Digital (MTD) legislation. This legislation forms a pivotal component of the UK government's Tax Administration Strategy, aiming to streamline tax processes and enhance efficiency for both individuals and businesses.
WHAT ARE THE CHANGES?
Digital Records: Bid farewell to paper-based receipts and manual record-keeping methods. Embracing MTD mandates the maintenance of digital records, prompting businesses and individuals to adopt compatible software solutions.
Software Mandate: Utilisation of software compliant with MTD standards becomes obligatory, facilitating the creation and storage of digital transaction records seamlessly.
Quarterly Updates: Annual tax returns make way for quarterly submissions, aligning tax reporting closer to real-time activities. An End of Year declaration, akin to conventional self-assessment tax returns, remains requisite.
Income Thresholds: Starting April 2026, compliance with MTD becomes mandatory for self-employed individuals and landlords earning above £50,000 annually. Those within the income bracket of £30,000 to £50,000 will follow suit by April 2027.
We are well aware of the upcoming changes when it comes to digital tax. If you have any questions about new legislation and the impact it could have on you, and would like to know more, do not hesitate to get in touch with us!
The article outlines just some of the details regarding changes in digital tax. It does not represent financial advice. If you would like personalised financial advice, please contact a financial adviser.
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