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Making Tax Digital Update

Last updated on April 4th, 2022 at 12:41 pm

Making Tax Digital (MTD) is the most fundamental change to the administration of the tax system for at least 20 years. This change might seem daunting, but we’ve compiled everything you need to know so your journey into digital tax recording is as easy going as possible.

Making Tax Digital for VAT

All VAT-registered businesses from April 2022 are required to follow the Making Tax Digital rules by keeping digital records and using software to submit their VAT returns, this applies to all businesses who were previously below the £85,000 threshold.

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 Making Tax Digital for Income Tax from 6 April 2024.

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. If you are a self-employed business or landlord you can voluntarily use software to keep business records digitally and send Income Tax updates to HMRC instead of filing a Self-Assessment tax return.

Making Tax Digital for Corporation Tax

The government has published a consultation on the future design of Making Tax Digital for Corporation Tax and welcomes views from companies and other organisations within the charge to Corporation Tax, agents, professional bodies and software developers.

The government will provide businesses with an opportunity to take part in a pilot for Making Tax Digital for Corporation Tax and will not mandate its usage before 2026.

What do I need to know now?

All VAT registered businesses who have not yet signed up for Making Tax Digital for VAT need to do so, to ensure a smooth transition to the new digital accounting recording requirements.

  • Consider whether your business qualifies for a digital exclusion exemption.
  • If you’re currently using accounting software, you’ll need to upgrade it to comply with the upcoming requirements.
  • If you’re currently keeping your records on a spreadsheet, you’ll need to obtain software that will allow returns and updates to be made directly from the spreadsheets. This is not yet available and there are no details of who will be supplying this or when.
  • If you’re currently keeping paper records, you’ll need to acquire and initiate the use of the appropriate software

What are the exemptions?

  • Those who are not able to engage digitally due to age, disability, location (e.g. no access to broadband) or religious reasons.

 

Burgess Hodgson can support your business through these changes and provide you with the services that you need for a smooth-sailing transition into MTD. For more information on how we can help contact bookkeeping@burgesshodgson.co.uk or call us on 01227 454627

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HMRC to start moving to new IT system

Posted: 24 June 2021

HMRC plans to move taxpayer accounts to a new IT system. They intend to implement these changes from July, till September 2021. This change will affect:

  • VAT-registered businesses that are not signed up to Making Tax Digital, i.e. mainly voluntary registrations; and
  • businesses that pay their VAT bills by direct debit.

HMRC are required by banking regulations compliance to inform businesses paying by direct debit of the amount and payment date before the payment is taken. HMRC will do this via email only to accommodate the short time frame between the return due date and the payment date.  This means that businesses are at risk of late payments as any direct debits will be cancelled if there is no email address on record.

We would encourage businesses to log in to their business tax account to ensure there is a valid and updated email address on record.

If you have any queries on this please contact us at info@burgesshodgson.co.uk

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Tax Tables 2021-22

Click here to download our free and useful tax tables for tax year 2021-2022

 

If you need help with your tax or have any questions please get in touch with our tax team at tax@burgesshodgson.co.uk

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Self-Employed Income Support Scheme

The third grant under the Self-Employed Income Support Scheme can now be claimed (from 30th November).

In order to qualify you must be a self-employed individual or a member of a partnership.

You must have traded in both tax years:

  • 2018 to 2019 and submitted your Self Assessment tax return on or before 23 April 2020 for that year
  • 2019 to 2020

(more…)

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Chancellor’s Spending Review

There was an absence of specific tax increases announced by the Chancellor in his Spending Review today, but a clear indication that the Government support will have to be paid for in the future. A public sector pay freeze and a cut in overseas aid have been announced – there will be tax rises to follow at some stage.

(more…)

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Annual Investment Allowance Extended

Posted: 18 November 2020

The £1 million limit was due to expire on 1 January 2021 – it has been extended until 1 January 2022

https://www.gov.uk/government/news/government-extends-1-million-tax-break-to-stimulate-investment-in-uk-manufacturing

Contact us at info@burgesshodgson.co.uk 

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Does Your Practice Need a Tax and Accounting Health Check?

Simon Bailey hosts our Q&A session with a team of our experts; Kenton May, Guy Vine and Gemma Jordan, with special guest Paul Gordon.

Watch the Q&A here.

If you have any further questions please get in touch at info@burgesshodgson.co.uk

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Major Changes Announced

Posted: 24 September 2020

Major changes have today been announced by the Chancellor. Detailed documents are awaited, summaries of the measures that the government has announced has been published and provide more information:

www.gov.uk/government/news/chancellor-outlines-winter-economy-plan

www.gov.uk/government/publications/winter-economy-plan/winter-economy-plan

(more…)

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MTD Digital Link Requirement Delayed.

HMRC have announced that the MTD digital link requirement will be delayed by a year to April 2021

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Autumn Newsletter 2019

Last updated on October 28th, 2019 at 09:34 am

Read our Autumn Newsletter 2019 here.

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