Posted by Gary Mackley-Smith on June 4, 2018
Landlords in receipt of UK property income can now join the government’s pilot scheme for Making Tax Digital (MTD) for income tax, to test how digital accounting records can be kept and disclosed electronically on a quarterly basis to the tax office.
Under the scheme, businesses and now landlords can online file their digitally-kept accounting records to HM Revenue & Customs (HMRC) on a quarterly basis.
No date has yet been set for when the scheme may be formerly introduced on a mandatory basis for income tax purposes, but it will not be before 2020, and probably later than that due to HMRC’s current focus on Brexit preparations.
MTD for VAT is planned to commence from 1 April 2019 for VAT registered organisations with an annual turnover in excess of £85,000 a year.
The MTD pilot for income tax is accessible for both taxpayers and agents so they can try out software for keeping records digitally and send income tax updates to HMRC four times a year, as an alternative to submitting an annual income tax return.
Initially introduced for self-employed businesses, pilot software can now be used to send income tax updates to report income from renting out UK property (excluding furnished holiday lettings).
Bishop Fleming can send updates to HMRC for you. We have a number of solutions available where you do not already use any software, or use software that is not suitable.
If you are a VAT-registered trader, check out our earlier article: Are you ready for the digital VAT changeover?
If you would like to discuss how MTD will affect your business or rental income, please contact your usual Bishop Fleming adviser, or a member of our Making Tax Digital team.