Making Tax Digital for Income Tax Self Assessment

[cobwebcottage]

For information for small businesses.

'HMRC's pilot scheme for Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is now live.

Accountants, agents and individuals are able to sign up to the pilot and test the programme out. The pilot aims to assess the MTD for ITSA reporting environment, with an initial focus on those who are self-employed and landlords with annual income exceeding £50,000. Signing up to MTD for ITSA will become mandatory for individuals with income in excess of this threshold from 6 April 2026.'

[magpiecorner1]

Tying up the the changes, for some, to the year end basis.  A 15 month year for me, as my year end in 31 Dec.

And changes already to cash basis accounting, now the default for self-assessment for most small businesses and partnerhips.  The thresholds have been removed, including the £500 threehold for interest, and changes to loss adjustments to bring in line with accrual accounting.  

Glad I will be finished by 2026, I still use a Catherdral book for a lot of my accounts! 

[janecampbel_4]

I'm in two minds about the MTD thing, I haven't read much about it to be honest.  Do you know if the deadlines will be the same as they are currently, ie 31st January of the following year or will it be similar to the vat returns and be required every quarter?

All in all I think it will be OK, if only that it will make me keep up to date with my book keeping.

Jim

[nebs9999]

I thought the ultimate aim for this is quarterly returns AND quarterly payments for self assessment. The payments will be for real time profits, rather than Jan/July at the end of the year like now. Start saving, as in the year it happens you will have two years tax to pay.