The previous timetable for Making Tax Digital was
- April 2018 – quarterly reporting for income tax purposes for unincorporated businesses with a turnover over £85,000
- April 2019 – quarterly reporting for both incorporated and unincorporated businesses for income tax and VAT
- April 2020 – quarterly reporting for corporation tax purposes
The new timetable will be
- Only VAT registered businesses will need to keep digital records and only for VAT purposes.
- They will only need to do so from April 2019.
- Businesses will not be asked to keep digital records or update HMRC quarterly for other taxes until at least April 2020 (the original dates had implementation from April 2019).
If you are VAT registered then you will need to move to digital record keeping (i.e. use software to record all your VAT invoices and receipts).
This is massive change in timetable and one that many small businesses and landlords will welcome.
Whilst this now gives smaller businesses longer to prepare, MTDfB is still coming in 2020 and expected to require unincorporated businesses to report the information noted below, so its still worth starting preparations and using cloud based accounting systems.
The details below are an extract from gov.uk for Quarterly Reporting
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
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