Making Tax Digital: Our guide to the upcoming changes to self-assessment in the UK
Making Tax Digital is on the way and Turas Accountants is ready to support you with the change. To help owners of small businesses prepare for the biggest shake‑up to self‑assessment in a generation, we have done the research and can provide all the help and support needed to make the switch.
Making Tax Digital for ITSA
The latest news from the UK Treasury and HMRC confirms the mandatory rollout of Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA) on a phased basis, will start from April 2026. The mandation thresholds have been set as follows:
- From 6 April 2026: For sole traders and landlords with a qualifying income over £50,000.
- From 6 April 2027: For those with a qualifying income over £30,000.
- From 6 April 2028: For those with a qualifying income over £20,000.
From April 2026, Making Tax Digital for Income Tax Self‑Assessment (MTD for ITSA) will require anyone with a gross income over £50,000, from self‑employment or property, to keep digital records and submit quarterly updates to HMRC using compliant software.
Making Tax Digital for VAT
If you have a VAT registered business, you are now required to keep digital records and file your tax returns using compatible software. There is a wide range of software available so take the time to see what works best for you. If you act now, you’ll have plenty of time to get familiar with the platform you choose.
Six steps to take to prepare for tax reporting changes
How We Can Help
We have been preparing for this transition so that you do not have to face it alone. At Turas, we have invested time in training, researching software options, and developing a support process tailored for our clients.
Here is what we offer:
- Choosing the Right Software: We will help you find the best MTD-compliant platform for your business, whether that is Xero or another trusted option.
- Setup and Training: We will guide you through setting up your software, and if you need it, we will provide personal training to ensure you are comfortable using it.
- Bookkeeping and Filing Support: If you would rather not deal with the digital side at all, we can take care of your records and submissions for you.
Straightforward Advice – No jargon, no pressure. Just real, practical guidance from a team that knows your business. We are here to help you get through this with as little stress as possible.
Making Tax Digital is the government initiative transforming the way we report tax to HMRC.
This will apply to businesses with a turnover above the VAT threshold. From April 2022, it was mandatory for any business that was VAT registered (either compulsory or voluntary) to be MTD compliant.
The Government’s current plan is that businesses will start using the Making Tax Digital system from April 2019 and only to meet their VAT obligations.
This will apply to businesses with a turnover above the VAT threshold, but other businesses can use the system voluntarily if they wish.
Other taxes will not fall within the scope of Making Tax Digital before April 2020, at the earliest.
You will be required to submit your income and expenses on a quarterly basis. This will need to be done using third party bookkeeping software. This essentially means that reporting on Excel spreadsheets will not be accepted.
No. HMRC have advised that there will not be a need to complete 4 tax returns each year. The best way to view the returns, is as a Quarterly Information Update. The details regarding exactly what this process will be are yet to be agreed and disseminated into the public domain.
You can register for your own digital tax account NOW. This will mean that you will be set up for when the quarterly reporting applies to you.
We will need you to provide us with your paperwork on a regular basis (at least quarterly) so that we can ensure that your accounts are up to date.
No. At the moment, we have been told that you will still only have to pay tax once a year, and the deadlines will remain the same for tax payments. However, by making 4 returns a year, you will be able to see throughout the year how much tax you are likely to have to pay. This will mean that you shouldn’t get a surprise at the end of the year.
HMRC have amended the original guidelines about who will need to report their income under MTD rules. If you are self employed or a landlord with income more than £50,000 you will need to enrol in to MTD for Income Tax from 6th April 2026, and if your income is more than £30,000 you will need to enrol in to MTD for Income Tax from 6th April 2027. Currently there are no plans for businesses or landlords with income less than £30,000 to comply with MTD rules.
Need help with Making Tax Digital?
If you’re looking for an accountant that can help you with Making Tax Digital, get in touch with us today.