Ahead of the Autumn Budget, there was hope that the new Labour Government might postpone the rollout of Making Tax Digital for Income Tax (MTD for IT). Unfortunately, those hopes were quickly dashed on Budget day, with the government confirming the original timelines. Additionally, a new announcement revealed that individuals earning over £20,000 from trading or property will be required to comply with MTD for IT regulations in the future.
The key mandate timelines are as follows:
- From April 2024: Eligible individuals can opt into the MTD for IT testing programme on a voluntary basis.
- From April 2026: MTD for IT becomes mandatory for landlords and self-employed individuals with combined trading and property income exceeding £50,000.
- From April 2027: The mandate will extend to landlords and self-employed individuals earning over £30,000 in combined trading and property income.
- Date TBC: A future date will see MTD for IT required for individuals with trading and property income exceeding £20,000.
As of now, there are no set deadlines for partnerships.
To comply with MTD for IT, individuals will need to maintain their business records using compatible software and submit their results to HMRC quarterly through the same software.
With just over a year until MTD for IT takes effect, now is the ideal time to start preparing if you’re self-employed (but not in a partnership) or earn rental income. We’re here to assist you through the changes, so don’t hesitate to reach out and find out how MTD for IT will impact you or your business!