Helping Landlords Transition Smoothly To Making Tax Digital (MTD)
Being a landlord has many great benefits, from a stable source of income giving returns on your property investment to the long-term security it can afford.
However, as the world begins to modernise and digitise at an increasing pace, it can be difficult to keep up with the bookkeeping side of things as a landlord of one or many properties, especially as Making Tax Digital (MTD) comes into play in just a few short years.
What Is Making Tax Digital?
The UK government is seeking to streamline their tax services and Making Tax Digital is a major overhaul of the system, which all landlords with an income of over £10,000 per year from renting will need to adhere to from April 2024.
In previous years, landlords could simply complete their annual Self-Assessment return and include any earnings on that – which will still be true should you earn under £10,000 per year in rental income – but from this new date the new rules will need to be followed.
HMRC has declared that landlords must use specific software in order to process their tax and earnings, which means keeping up-to-date digital records of everything to do with your business as a landlord.
All income and expenditure will needs to be tracked digitally. Quarterly reports need to be filed every three months through the software, and income needs to be finalised annually with an EOPS and a final declaration, all sent in the same way to HMRC.
What Does This Mean For Landlords?
Here at McCarthy Browne, we understand that going into this new digital way of working isn’t ideal for many landlords.
Firstly, having to submit quarterly returns of all income and expenditure, especially if you have multiple properties, will be time-consuming, stealing precious hours from your day job or leisure time.
Sifting through paper receipts and trying to coordinate everything into a computer system will not appeal to everyone, and is likely to cause stress if you don’t understand exactly how to input that information and get it sent off by the right deadlines.
Then there’s the matter of buying and learning how to use one of the hundreds of approved software models that the government requires in order to process your income and expenditure.
If you’re not computer literate, or just worry that you’ll make mistakes which can delay your process and highlight you for an HMRC investigation, this is another point to consider.
How Can McCarthy Browne Help?
Whether you are set up as a sole trader or a small business, it’s always prudent to have a financial advisor to guide you along the path and keep you on the right side of HMRC at all times.
McCarthy Browne are specialists in all aspects of bookkeeping and accountancy, and we’ve already aligned our systems and software with the HMRC to capably deliver tax returns, quarterly and annual reports on behalf of our landlord clients.
We know that you want your rental properties to generate you a stable source of income over the years without causing you stress or anxiety, especially when it comes to the financial aspects. McCarthy Browne already have many years of experience working with landlords, and we are ready and waiting to make your life a whole lot easier when it comes to getting you MTD ready.
No more fiddling through bits of paper, searching your bank transactions, trying to remember every one of your expenses and wondering if you’ve submitted to HMRC correctly – we are on hand to take the load off, and take care of everything for you.
Landlords need to be registered with the MTD system before April 2023, so if you like the sound of a qualified accountancy firm handling everything for you and doing all the legwork, get in touch with us today.