- Overview of Making Tax Digital (MTD): MTD is UK legislation mandating that VAT-registered businesses maintain digital accounting records and submit VAT returns electronically using HMRC-compatible software. The initiative aims to reduce errors, simplify tax processes, and modernize the interaction between businesses and the tax authority.
- Compliance Timeline and Expansion: Since April 1, 2019, MTD has been mandatory for businesses with a taxable turnover above £85,000, and from April 2022, all VAT-registered businesses must comply with digital record-keeping and electronic submissions. The initiative will expand to include Income Tax Self Assessment (ITSA) for self-employed individuals and landlords starting April 2026, with further requirements rolling out in subsequent years.
Source Edicom
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