- MTD for VAT will apply to all VAT registered businesses, regardless of turnover, from April 2022 (currently it only applies to businesses with taxable turnover above the VAT threshold of £85,000).
- Income Tax Self Assessment will be introduced from April 2023, for unincorporated businesses and landlords with income over £10,000.
- The government will consult later this year in relation to corporation tax.
Making Tax Digital for VAT
VAT-registered businesses with a taxable turnover above the VAT threshold (£85,000) are now required to follow the Making Tax Digital rules by keeping digital records and using software to submit their VAT returns.
If you are below the VAT threshold you can voluntarily join the Making Tax Digital service now.
VAT-registered businesses with a taxable turnover below £85,000 will be required to follow Making Tax digital rules for their first return starting on or after April 2022.
Making Tax Digital for Income Tax
Self-employed businesses and landlords with annual business or property income above £10,000 will need to follow the rules for MTD for Income Tax from their next accounting period starting on or after 6 April 2023.
Some businesses and agents are already keeping digital records and providing updates to HMRC as part of a live pilot to test and develop the Making Tax Digital service for Income Tax. As accountants, we already use digital software in order to submit our clients personal Tax returns, therefore if you use Chippendale and Clark for your accountancy services, we are already ahead of these changes.
If you know of someone who completes their own personal tax returns using the current HMRC online platform, please do not hesitate to have them contact us so that we can discuss their options. 2023 may seem a few years away, however it is important to plan in order to ensure you meet your accounting deadlines.
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