With only eight months until MTD for Income Tax for the affected £50k plus earners, awareness is low and the reporting is complex and burdensome due to quarterly reporting requirements. Stuart Miller, director of product compliance, Xero, explains the key issues to consider
For the 780,000 sole traders, small businesses and buy to let landlords earning over £50,000, it might feel like Making Tax Digital for Income Tax (MTD) is still a long way off. But April 2026 will quickly creep up on businesses – and their accountants.
The countdown is on so it is vital that small businesses and their advisors start preparing to understand and adapt to a new way of working. While next year’s deadline is applicable to a specific set of businesses and entities with income over £50,000, that threshold falls to £30,000 from April 2027 and will encompass those earning over £20,000 by 2028.
There are three core principles behind the upcoming MTD mandate - businesses will need to shift towards quarterly reporting, keep digital records and submit returns using MTD compatible software.
