A leading Shropshire firm of accountants is warning small businesses that the countdown has started to major changes to the way income and expenses are reported – and they need to be prepared.
Telford-based Turas Accountants says businesses should start getting ready now for the new Making Tax Digital (MTD) rules which come into force in one year’s time.
Owner Helen Columb said all self-employed people and landlords with a turnover of more than £50,000 would be required to join the Making Tax Digital for Income Tax Self-Assessment scheme from next April.
It would then be extended to include those with a turnover of between £30,000 and £50,000 from April 2027 and those between £20,000 and £30,000 in April 2028.
Under the programme, income and expenses details must be submitted quarterly to the taxman using digital software although there will be no change to when tax is collected.
“These are significant changes on the horizon for thousands of self-employed people and landlords and it is important that they start preparing for them now rather than leave it to the last minute.”
Helen said there were a number of things people could do now including:
- Setting up your own government gateway, even if you have an accountant. HMRC sends emails out regularly with information, and having access to your portal means you can keep on top of any updates and see where you are with your tax and National Insurance.
- Separate your finances. Have a separate bank account for business transactions, even if this is a separate personal bank account. There are lots of banks that offer free or reduced fees for sole traders. The software that you will use will be able to connect to your bank, and it will make life far easier if you only have to deal with business transactions rather than pick through personal ones.
- Landlords should also have a separate bank account for these transactions.
- Look at adopting software NOW. Don’t wait until your staging date. Give yourself time to understand the systems and how they work without the time pressures of deadlines from HMRC hanging over your head. You will probably save far more time in the long run as you can raise invoices directly in the software rather than on paper or via Word documents.
- Look at instructing an accountant now rather than later on when the staging date is looming if you want help with the administration. Accountants will be in high demand and they may have waiting lists that will just add to your stress levels.
Helen added: “To add to the changes, from April 2026 MTD users will need to submit their Self-Assessment return through the same software they use for their MTD returns and you will no longer be able to submit through the HMRC portal once you have been enrolled under MTD for ITSA.
“There are a number of software options available – our choice is Xero – and it is well worth getting started now so that you can see how they work and get used to handling them.”
Turas, which is based in Hall Court in Telford Town Centre, started trading in 2013 as Columb & Gosling Accountants. It changed its name to Turas Accountants five years ago under Helen’s leadership.
It now works with clients across the country covering VAT, company accounts, bookkeeping and payroll. It specialises in e-commerce, helping clients who have online businesses using marketplaces such as Amazon, eBay and Etsy.