Since 2019, many VAT-registered businesses with a taxable turnover above the VAT threshold (£85,000) have been mandated to keep digital VAT records and send returns using Making Tax Digital (MTD)-compatible software.
From April 2022 these requirements will apply to all VAT-registered businesses. It has also been announced that MTD for income tax self-assessment (ITSA) will finally be introduced from April 2023 for unincorporated businesses and landlords with total business or property income above £10,000 per year. Most businesses will have two years to prepare and test the service voluntarily prior to its introduction.
Derek Grant has explored the importance of making tax digital during COVID-19 in a recent blog post, click here to find out more.