Once the election is over, Making Tax Digital will be pushed forward again, ready for its launch in April 2018.
If you aren’t using any software or apps to prepare your accounts, now is the time to start. Under MTDfB – Making Tax Digital for Business – Sole Trader, Partnerships, Landlords and ultimately Companies will need to file returns every quarter and submit a final year end return.
This what you will need to report
The categories of information listed below are being reviewed and have not yet been finalised. They have been included mainly for indicative purposes.
Non-property businesses
Income:
- turnover, takings, fees, sales or money earned
- any other business income
Expenses:
- cost of goods bought for resale or goods used
- construction industry – payments to subcontractors
- wages, salaries and other staff costs
- car, van and travel expenses
- rent, rates, power and insurance costs
- repairs and renewals of property and equipment
- phone, fax, stationary and other office costs
- advertising and business entertaining costs
- interest on bank and other charges
- bank, credit card and other financial charges
- irrecoverable debts written off
- accountancy, legal and other professional fees
- depreciation and loss/profit on sale of assets
- other business expenses
- goods and services for your own use
- income, receipts and other profits included in business income or expenses but not taxable as business profits
- disallowable element for each category
Property businesses
Income – furnished holiday lettings:
- rental income and any income for services provided to tenants
Expenses – furnished holiday lettings:
- tax taken off income
- rent paid, repairs, insurance and cost of services provided
- loan interest and other financial costs
- legal, management and other professional fees
- other allowable property expenses
- private use adjustment
- premiums for the grant of a lease
- reverse premiums and inducements
- property repairs and maintenance
- costs of services provided, including wages
Income – property:
- rental income and other income from property
Expenses – property:
- tax taken off any income from total rents
- premiums for the grant of a lease
- reverse premiums and inducements
- rent, rates, insurance, ground rents etc.
- property repairs and maintenance
- loan interest for residential properties and other related financial costs
- other loan interest and financial costs
- legal, management and other professional fees
- costs of services provided, including wages
- other allowable property expenses
- private use adjustment
Partnerships
Interest and alternative finance receipts without UK tax deducted:
- interest and alternative finance receipts from UK banks and building societies paid without tax deducted
- interest distributions from UK authorised unit trusts and UK open-ended investment companies and investment trusts
- income from National Savings and Investments
- other untaxed income from UK savings and investments (except dividends)
Interest and alternative finance receipts with UK tax deducted:
- other taxed income from UK savings and investments (except dividends) (amount net of tax deducted)
- tax deducted
Dividends:
- dividends and other qualifying distributions from UK companies
- tax credits attached to such dividends etc
- dividend distributions from UK authorised unit trusts and open-ended investment companies
- tax credits attached to such distributions
- stock dividends from UK companies
- tax credits attached to such stock dividends
- non-qualifying distributions and loans written off
- tax credits attached to such distributions etc
Other income received without UK tax deducted:
- other income – profit
- other income – loss
Other income received with UK tax deducted:
- other income (amount net of tax deducted)
- tax deducted
Partnerships – end of year information
Disposal of capital assets – partnerships:
- description of assets
- whether listed or unlisted shares or securities (if applicable)
- name of partners who benefited from the disposal proceeds
- total proceeds from disposal
End of year information
Tax adjustments and elections:
- adjustment required where the basis period is not the same as the accounting period under section 203 of the Income Tax (Trading and Other Income) Act (ITTOIA) 2005
- averaging adjustment applied to taxable profits where an election has been made for averaging under section 222 or 222A of ITTOIA 2005
- adjustment required as a result of a change in basis under Chapter 17 of Part 2 of ITTOIA 2005
- total of any construction industry scheme deductions taken from payments made to subcontractors under section 61 of Finance Act 2004
- any other tax deducted from trading income (excluding deductions made by contractors on account of tax)
- sums due to be charged under sections 277 to 285 of ITTOIA 2005
- adjustments required under Chapter 7 of Part 3 of ITTOIA 2005
- claims for loss relief under Chapter 2 of Part 4 of the Income Tax Act 2007 (Chapter 4 for property businesses)
- disallowable expenditure
- foreign tax deducted
- any other tax adjustment
- adjustment on change of basis
- foreign tax deducted
Capital allowances – claims and balancing charges:
- annual investment allowance
- capital allowances at 18%
- capital allowances at 8%
- restricted capital allowances on cars costing more than £12,000 where bought before 6 April 2009
- business premises renovation allowance
- enhanced capital allowances: energy-saving relief
- enhanced capital allowances: environmentally-beneficial relief
- enhanced capital allowanced: electric charge-points
- enhanced capital allowances: gas refuelling equipment
- allowances on sale or cessation of businesses use (where an asset has been disposed of for less than its tax written down value)
- total capital allowances
- balancing charge on sale or cessation of business use (where business renovation allowance has been claimed)
- balancing charge on sales of other assets or on the cessation of business use (where an asset has been disposed of for less than its tax written down value)
