Making Tax Digital (MTD)

Making tax digital is upon us. HMRC have been working hard in order to revamp the tax filing system and make the whole system more efficient by embracing the use of technology.

By HMRC's defition " Making Tax Digital is a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their affairs."

HMRC's aim is to become the most digitally advanced tax administrations in the world.

Until now, MTD affected business who were VAT registered however in 2023 and 2024 new changes will mean almost every business and individuals who file a tax return, will need to comply with MTD rules. This means tax returns will need to be filed digitally and records kept digitally. 

The changes will affect businesses that are not VAT registered i.e. turnover lower than current threshold of £85,000. Changes will also affect those who file a self assessment for various reasons including those who have rental income.

One of the changes is quarterly filing which will mean more frequent production of accounts.

More detailed information is available on www.gov.uk