For landlords paying income tax with a qualifying income of over £10,000,
Making Tax Digital for Income Tax rules will come into force on 6 April 2024.
For landlords paying income tax with a qualifying income of over £10,000,
Making Tax Digital for Income Tax rules will come into force on 6 April 2024.
Making Tax Digital for Income Tax applies to individual landlords. If you manage your property
portfolio through a limited company, you’ll only be affected by the changes to Corporation Tax,
currently expected no earlier than 2026.
WHAT WILL BE YOUR OBLIGATIONS UNDER MAKING TAX DIGITAL FOR INCOME
TAX SELF ASSESSMENTS?
Creating and storing records of your business transactions
These records should be created as close to the transaction as possible and
before your quarterly deadlines, as outlined below.
Confirming your end of period statements
At the end of each tax year, the information you shared in your quarterly
updates will be combined to show your total yearly income and expenses.
You may need to make accounting or tax adjustments, or claim relief before
submitting by 31 January after the end of the tax year.
Making your final declaration
After you’ve finalised your end of period statements, you’ll then be able to
send HMRC additional information about your personal income sources.
This income doesn’t qualify under Making Tax Digital, so you can submit it
either via the MTD software, or through your HMRC online services account.
MAKING TAX DIGITAL FOR INCOME TAX:
A GUIDE FOR LANDLORDS
WHAT DO YOU NEED TO DO BY 6 APRIL 2024?
Your Self Assessment Tax Returns for 2022 to 2023 need to be submitted by 31
January 2024
HMRC will review them and check if your income is more than £10,000
If it is, you’ll need to meet the MTD for Income Tax requirements by 6 April 2024
You’ll need to choose and authorise software compatible with MTD for Income Tax
You’ll also need to sign up for MTD for Income Tax
WHAT ARE THE PENALITIES FOR NON COMPLIANCE?
If you file your returns late, you’ll receive a point for each missed submission deadline.
After a certain number of points – 4 points when submitting your returns quarterly – you’ll
receive a fine of £200.
WHEN DO THESE POINTS EXPIRE?
These points will expire after 2 years, if:
- You submit all your required returns on time for a set period, such as 12 months if you submit your returns quarterly
- You’ve submitted all your returns from the past 24 months, even if they were initially late
This document is intended as a guide only and does not constitute legal advice. For more
information, visit gov.uk.
