Hi Edward! Making Tax Digital (MTD) is the government’s plan to transform the tax system and move it online.
Since 1st April 2019, VAT registered businesses have had to keep their VAT records digitally, and automatically submit their VAT returns to HMRC through ‘MTD compatible software. As of April 2022, MTD will be compulsory for businesses with a turnover below the £85,000 VAT threshold.
If you’re VAT registered and you don’t currently use a digital accounting package (such as Crunch) to record your VAT information, then you need to ensure you’re ready for MTD now.
This will become more and more commonplace in the coming years. Self-employed businesses and landlords with annual business or property income above £10,000 will need to follow the rules for MTD for Income Tax from their next accounting period starting on or after 6 April 2023.
The government are currently looking into a similar program for Corporation Tax, although have said this won't kick in until at least 2026.
There's stacks of info on Crunch's Making Tax Digital Hub, including how to book a free consultation with one of our experts if you're unsure of anything.
