Making Tax Digital

We offer a competitively priced range of services for "Making Tax Digital" preparation and support.

Get in touch to find out how we can help you.

Making Tax Digital Support

Making Tax Digital (MTD) involves the filing of returns online and forms part of a wider government initiative to help businesses keep on top of their tax affairs. MTD is making fundamental changes to the way the tax system works so that it is:

  • More efficient and effective.
  • Easier for taxpayers to get their tax right.

This proposed change will bring fewer reporting errors, less time spent on paperwork, reliable record-keeping and faster filing of returns.

How to prepare for Making Tax Digital

The Making Tax Digital rules require that you:

  • Keep and maintain your records digitally.
  • Send your returns to HMRC via MTD-compatible software.

Only specific software meets the Making Tax Digital requirements.

Under MTD rules, you won't be able to submit your VAT return via the HMRC website. Instead, you’ll need compatible software with an MTD for VAT feature and submit your return from the platform.

Compatible software

There are a number of softwares that are available now, including Xero and Sage, with many others in development.

Key Deadlines

  • April 2022

    Making Tax Digital (MTD) was extended to all VAT-registered businesses, even including those that were voluntarily registered for VAT.

  • January 2023

    There will be a new penalty system in place for VAT Making Tax Digital late submissions.

  • April 2024

    Making Tax Digital for Income Tax will be introduced for sole traders with gross income of over £10,000 per year. This is separate to Making Tax Digital for VAT and different rules and regulations apply.

  • April 2025

    Making Tax Digital for Income Tax will be extended to general partnerships that have over £10,000 in gross income per year.

  • April 2026

    This is the earliest date that Making Tax Digital for Corporation Tax could be introduced, and this will apply to incorporated businesses that are liable to corporation tax.

Fines and Penalties

For every submission deadline missed, you will receive one point. Penalties for not complying with MTD depend on how frequently you submit.

Fines will arise once a taxpayer reaches a certain points threshold. If you don’t maintain digital records, you may also face a penalty for non-compliance. Penalty thresholds are as follows:

Monthly: 5 points

Quarterly: 4 points

Annually: 2 points

These points will expire after 2 years.

If you reach these penalty thresholds, you will incur a £200 fine.

Please note that separate points tallies are recorded for VAT and Income Tax.

How Toast can help

Here at TOAST, we are already providing MTD compliant services and all our team members are able to provide support and help on any MTD related issues our clients may have.

MTD compliant services we provide are as follows:

Digital Record Keeping Digital Filing Support
Tax Return
Company Accounts & Tax

If you need assistance book a FREE consultation today by clicking the "Book a call" button on this page, or fill in the form and we will get in touch.  Alternatively, you can give us a call on 0333 070 5920.

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