The Government has announced a one year extension to the start date for Making Tax Digital for Income Tax Self Assessment (MTD ITSA) from April 2023 to April 2024. The extension has been given to allow businesses more time to recover from the COVID-19 pandemic.
MTD ITSA is to be introduced for taxpayers with business or property income over £10,000 a year from 6 April 2024, meaning instead of an annual self-assessment cycle, there will be five filing cycles each year. Each filing cycle will fall on the same dates each quarter, with a ‘final’ fifth filing required to sweep up any missing or inaccurate information.
Businesses, the self-employed, and landlords will be required to keep their records digitally along with submitting a quarterly summary of income and expenses, plus an end of year report to HMRC using third party software. Partnerships have until April 2026 before being added to MTD ITSA, with limited companies being added further down the line.