Making Tax Digital for income tax will apply from April 2023 for self-employed businesses, partnerships and landlords with total gross income above £10,000. Businesses and landlords who join MTD for income tax will need to submit a quarterly summary of their business income and expenses to HMRC using MTD-compatible software (such as QuickBooks Online).
The intention is that having made quarterly submissions of income and expenses, taxpayers will receive an estimated tax calculation based on the information provided to help them budget for their tax.
The government’s view is that digital records are more accurate and eliminate avoidable mistakes hence the push towards ‘Making Tax Digital’ over the past few and coming years.
For more information on making tax digital for income tax please see Follow the rules for Making Tax Digital for Income Tax – GOV.UK (www.gov.uk)