Update on Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA)
Just before Christmas the government announced some welcome changes to the rollout of MTD for ITSA.
It will no longer be mandatory from April 2024. The new plan is now a phased approach starting from April 2026, giving longer to prepare for the new system.
The minimum income level it will apply to has also been raised from £10,000, to £50,000 from 2026 and then from April 2027 it will also apply to those earning
The government will be reviewing the approach to MTD for ITSA for small businesses, particularly those with income below £30,000.
This is all welcome news for many small businesses, reducing the potential administrative burden MTD for ITSA would cause. Although, of course, any RockSalt clients are already well prepared to handle it!
There will be the opportunity to join voluntarily before it becomes mandatory, allowing people to get used to the process and help with eliminating common errors. RockSalt will continue to keep clients updated with the situation as it evolves and will make relevant recommendations to individual clients based on what best suits their individual circumstances.
Even with the changes to the roll-out of MTD for ITSA, I would still highly recommend making the jump to an online accounting system as there are lots of other benefits to gain from, such as;
Reduction in time spent on bookkeeping & accounting through
- Automation of tasks e.g. open banking feeds allow transaction data to flow
straight from your bank into your books without manual input
- Intuitive software that learns your behaviour
Flexibility to access information from any computer or mobile device with internet access, anytime & any place that suits you.
Real-time overview allows better understanding of your current financial position and faster decision-making.
Data stored using cloud software gives you more protection & security against your data being lost, damaged or corrupted.
Multi-user access makes it easier to collaborate with others such as team members and your accountant!
Scalable as your business needs change
Give RockSalt a shout if you are interested in finding out more about MTD for ITSA & how it might affect your business!
Read the government's announcement here: