Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) will apply to individuals from April 2024, if their total gross income from self-employment and property exceeds £10,000 in a tax year. We already have cost-effective software and tools ready to go as our clients have already switched to the new, compliant system as well as receiving a high number of new enquiries from clients looking to move over before to ensure any problems are dealt with and resolved before the deadline kicks in.
MTD ITSA Requirements
- Register for MTD for Income Tax
- You need MTD ITSA compatible software
- Then create and store digital records of each of your business transactions
- Send updates of the totals of your business income and expenses every 3 months
- Confirm end of period statements (EOPS) for all sources of sole trader and property income
- Submit your final declaration. This will be possible either through your compatible software or your HMRC online services account.
Who Can Submit MTD for ITSA
Business owners are able to do this themselves or choose an agent (such as Cashtrak) to do this on their behalf. The benefits of using Cashtrak:
- Over 16 years’ experience
- We can guide you through the registering and set up process
- We find allowable expenses and tax savings on your behalf
- Guidance and tips on how to better manage the process
- Free yourself up to concentrate on your business
- Send us your paperwork as soon as you receive it – no more trying to find paperwork
Accountants And Bookkeepers Thoughts
There are a lot of questions in the run up to the deadline, AccountingWeb recently held a survey of bookkeepers and accountants thoughts on whether or not clients should be able to submit their own quarterly summaries.
The majority of respondents believe that at least some clients should be able to do their own quarterly summaries, this pie chart shows the findings:
AccountingWeb reported ‘Many respondents highlighted that giving some clients the option to do their own quarterly summaries would be a good way for them to minimise costs; we know that sole traders and unincorporated landlords are among the most price-sensitive clients, and many pointed out that this route would help accountants avoid increasing their rates to account for the increased workload.’
Continuing ‘That said, many advisors noted that they only feel comfortable with this option because they still retain control over the EOPS—which they think of as the ultimate source of truth for HMRC. ‘
In the responses from those in favour of all clients being able to submit quarterly summaries, reasons included the worry of increased workload and costs, as well as clients’ rights answers included:
- Costs of services risk becoming disproportionate
- Too much work for accountants/ bookkeepers to cope with
- It’s the client’s right
No they shouldn’t
On the opposite side of the fence are those who believe that MTD ITSA clients should not be given the option to submit their own quarterly summaries.
- ITSA clients may not have sufficient knowledge
- Getting your clients to do their own summaries is a false economy
- Should be part of the service
With our very own MD, Carol Webb quoted as saying:
“If we can do the quarterly returns, there will be less time spent reviewing what has happened before and making changes. This will mean the final submissions can be done quicker and easier. We will have more work to do as it is, and need to ensure we spread the load.” Carol Webb, Director at Cashtrak Ltd.
What are your thoughts? Let us know at:
Linked In: Cashtrak Bookkeeping Services
More information on our tax return service, click here.