MTD is now the only method you can use for VAT returns (MTD for VAT) and from April 2024 this will begin to apply to Income Tax Self Assessments (MTD for ITSA).
MTD for ITSA is the roll-out of Making Tax Digital for people who use self-assessment to file and submit tax returns.
It applies to unincorporated / sole trader businesses and landlords with a total business or property income above £10,000 per year. (If you own multiple businesses, the income from all of them contributes to the £10,000 threshold.)
This means that accounting records relating to income tax must be held digitally within MTD compatible software. There’s a wide range of HMRC MTD compatible software available from a variety of providers. One of which is our IRIS KashFlow software which we discuss in more detail further down this page.
If you currently keep your accounts using spreadsheets, ledger books, etc. now is the time to start recording your accounts digitally.
From April 2024, instead of sending one submission each year, you will need to submit quarterly updates about your business income and expenses (you can submit more frequently if you want to). You will also need to send an end of period statement (EOPS) and a final declaration at the end of the tax year.
We are enhancing IRIS KashFlow to support MTD for ITSA including tax calculations, a customisable periodic update report, and submission reminder emails and logs.
Our MTD ITSA software will have an end-to-end solution well ahead of the April 2024 deadline. Once MTD for ITSA is live in 2024, you will be able to submit all 6 returns with confidence and accuracy.
In the meantime, you can continue using IRIS KashFlow to record your accounts. If you’re new to our accounting software, why not start a free trial.
If you are an Accountant, IRIS KashFlow Connect will be enhanced to flag ITSA registered users so that you can give your clients the support they need.
You can only opt out if you are digitally exempt. You can request to be made exempt using the form on the government website.
At the moment, you can only sign up to HMRC’s pilot scheme. We will provide further information when it’s possible to sign up directly.
Get ahead of MTD for ITSA and start recording your online accounts now. It’s quick and easy to sign up and we’ll help you get started.