UK sole traders unprepared for MTD changes

What is Making Tax Digital for Income Tax (MTD for IT)? Under MTD, most sole traders and landlords whose combined “qualifying income” is above a mandatory threshold will need to:  -Keep digital business records -paper records will no longer be allowed -Use HMRC-approved software to submit quarterly updates to HMRC -Submit an annual final declaration at the end of the tax year (this replaces the self assessment return) “Qualifying income” is your total gross income from self-employment and property in a tax year, before expenses. For more information, see HMRC's guidance following the link: https://lnkd.in/e-CepwHB Please contact us at: www.banks-sheridan.co.uk

Almost half of UK sole traders feel unprepared for upcoming Making Tax Digital (MTD) for Income Tax changes, according to research conducted by IRIS Software. The new MTD rules mandate digital record-keeping and quarterly Income Tax updates starting April 2026 and non-compliance can lead to significant penalties. The study found that almost one in three sole traders have never heard of MTD, MTD for Income Tax will require self-employed individuals, landlords and small businesses earning over £50,000 to keep digital financial records and submit quarterly updates using compatible software from April 2026. The threshold drops to £30,000 in 2027 and to £20,000 in 2028. The changes could place a significant burden on business owners, who will be required to submit at least five updates to HMRC each year. Follow Brook & Co for more tax news and tips. 📍 Offices in Brackley and Milton Keynes. Get in touch now. 📧 info@brookandco.com 💻 www.brookandco.com

TaxBanter’s latest tax update: A quick hit for advisers 📌   ☑️Bill alert: Treasury Laws Amendment (Strengthening Financial Systems) Bill 2025 | Technical GST/ITAA fixes, explicit deduction for reverse‑charged GST and $20,000 instant asset write‑off for small businesses proposed to be extended (2025-26) ☑️ ATO compliance focus: PCG 2025/2 | New zone‑based approach to thin‑capitalisation and the DDCR; expect detailed tracing and apportionment requests on restructures ☑️ Division 7A risk: TD 2025/5 | ATO view that s.109R can disregard actual or notional repayments where interposed entities create notional loans - increases deemed dividend risk ☑️ GST warning: Barth Family Trust | AAT confirms ITCs are lost if BASs claiming them are lodged after four years (s.93‑5) ☑️ Tribunal signals: Wannberg - medical expenses remain private (not deductible); Goldenville - trustee resolutions must be demonstrably made before 30 June.   TaxBanter’s expert trainers bring you timely coverage of legislation changes, ATO rulings, budget measures, court cases, and emerging issues - all backed up with a comprehensive technical paper.  

MTD for IT will fundamentally change how you report your income to HMRC. From April 2026, individuals earning £50,000 or more in sole trade and/or property income will need to comply. If you fall within the thresholds for 2027 or 2028 mandation, it’s important to start preparing now to make the transition smoother. Find more information on MTD for IT and download our handy guide here 👉https://lnkd.in/e-jBmDU9. #MTDforIT #makingtaxdigital #tax #MTD #Income #HMRC #soletrade #selfemployed #property #landlord

With the recent release of UK R&D tax credit statistics it would appear HMRC is achieving its goal of reducing SME R&D tax credit claims. While RDP agreed there were many SME's filing claims that were not eligible, HMRC quantified this by stating up 50% of all R&D tax credit claims were in error. In 2020-2021 the number of SME claims exceeded 75,000. In 2023-2024 the number of SME claims were slightly over 36,000. The question now is whether the R&D tax credit rate for most SME's of roughly 16% is a sufficient incentive when many EU countries have tax credits of over 30%?

What do you think the biggest hurdles will be when it comes to implementing MTD? Read the report from Wolters Kluwer to learn how accountants across the UK are preparing.

What do you think the biggest hurdles will be when it comes to implementing MTD? Read the report from Wolters Kluwer to learn how accountants across the UK are preparing.

The OBBA introduced significant changes to tax law that impact high-net-worth individuals, including new rules on global income tax to expanded opportunities for Qualified Small Business Stock. https://lnkd.in/gP6mwuD2 #internationaltaxnews #IWTA #OBBA #GILTI #HNWI

Parliament has now approved that the self-employed will no longer have to pay the tax. Our overview explains: - what the new measure means in practice - what will happen to business accounts - whether the self-employed can include the paid transaction tax among their expenses. Flatiron Tax Vladimíra Mačuhová Zuzana Ďuďáková UniCredit CSOB Tatra banka VÚB banka mBank S.A. Slovenská sporiteľňa 365.bank Martin Palkovič Read more: https://lnkd.in/eiY5DDNm

It’s 2025! 4 Things You Need to Know About Making Tax Digital (MTD) We at Sakura are closely following and monitoring the updates on the upcoming change in 2026 under making tax digital (MTD) for income tax . this issue will be a big game changer for self assessment tax payers and will require some support and guidance from us on the back of these changes.   Making Tax Digital (MTD) is transforming how individuals and businesses in the UK manage their tax affairs. NOW Whether you're a sole trader, landlord, or accountant, understanding MTD is essential as HMRC continues its digital overhaul. https://lnkd.in/ei7cn84R