04/11/2025
https://www.gov.uk/government/collections/making-tax-digital-for-income-tax
Big changes for those who are self employed or landlords.
Advice I would give to start the process going:
*using one bank account for all income and expenditures
*starting to think about using Xero or Quickbooks (Xero better imo)
*For those with an income of over £50,000 it will be relevant for you from next year
The basics are you will need to file 4 quarterly returns using software (like Xero) and then your annual return.
The easiest way to do this is to attach your bank account to Xero and then allocate spending/income. I am happy to teach my clients to do this themselves.
Gone are the days when we can use spreadsheets with this new change.
£50,000 for the 2024 to 2025 tax year, you will need to use it from 6 April 2026
£30,000 for the 2025 to 2026 tax year, you will need to use it from 6 April 2027
£20,000 for the 2026 to 2027 tax year, the government has set out plans to introduce legislation to lower the qualifying income threshold
Find out about using Making Tax Digital for Income Tax, including software choices and step by step guidance for sole traders, landlords, and their agents.
