HMRC’s New MTD for Income Tax Starts in April 2026: What Landlords and the Self-Employed Need to Do Now

For many landlords and self-employed people, tax has always meant one main rush each year.
That is changing.

From 6 April 2026, HMRC’s new Making Tax Digital for Income Tax (MTD ITSA) rules begin for many sole traders and landlords. If you are affected, you will no longer be able to just leave everything until the end of the tax year. Instead, you will need to keep digital records and send quarterly updates to HMRC using compatible software.

This is a major shift, and many people are still underestimating how much work, organisation and accuracy it will really require. That is exactly why now is the right time to get proper help.

What Is HMRC’s New MTD for Income Tax From April 2026?
From 6 April 2026, many landlords and self-employed people with qualifying income over £50,000 must keep digital records and send quarterly updates to HMRC using compatible software.

HMRC’s test is based on your qualifying income, which means your gross income from self-employment and property before expenses, not your profit. If your combined qualifying income is above £50,000 for the 2024/25 tax year, you may need to join MTD for Income Tax from 6 April 2026.

This is not just a software change. It is a new reporting habit, a new compliance system and, for many people, a new source of pressure unless it is set up properly from the beginning.

Who Will Be Affected First?
From 6 April 2026, MTD for Income Tax applies to sole traders and landlords whose total qualifying income from self-employment and property is over £50,000 based on the 2024/25 tax year. From 6 April 2027, the threshold drops to over £30,000 based on the 2025/26 tax year, and HMRC has also said that those with qualifying income over £20,000 will be brought in from 6 April 2028.

This means:

• a landlord with gross rents over £50,000 may be in
• a self-employed person with sales over £50,000 may be in
• someone with both rental income and self-employed income may be in even if neither one alone is over £50,000, because HMRC looks at the combined total

One of the biggest misunderstandings is this: 

HMRC is looking at gross income, not profit.

So if you earn £28,000 gross from self-employment and £24,000 gross from property, your combined qualifying income is £52,000, which means you are likely in scope from April 2026.

What Will You Actually Have To Do?
If you are caught by the new rules, you or your agent will need to use MTD-compatible software to:

• create and keep digital records
• record self-employment and property income and expenses
• send quarterly updates to HMRC
• complete the year-end process through software, including the final tax position

The key dates HMRC has published for those joining from April 2026 include:

• 6 April 2026 – start keeping digital records under MTD
• 7 August 2026 – first quarterly update due
• 7 November 2026 – second quarterly update due
• 7 February 2027 – third quarterly update due
• 7 May 2027 – fourth quarterly update due
• 31 Jan 2028 – first MTD ITSA end-of-year tax return for the 2026/27 tax year due

Importantly, the 2025/26 tax year is still filed in the usual Self Assessment way by 31 January 2027, because that tax year ends before MTD begins. And MTD ITSA does not record other types of income such as savings interest, dividends, CGT, overseas, wages etc.

Why This Feels Much Bigger Than “Just Software”
A lot of articles online make MTD sound like a basic software upgrade.
It is not.

For many landlords and self-employed people, this will mean changing from a once-a-year tax mindset to an every-quarter compliance routine. That means more deadlines, more record keeping, more chances to get behind, and more pressure if the books are not tidy from the start. HMRC’s guidance makes clear that you must use compatible software, keep digital records and submit quarterly updates before you can complete the end-of-year process.

Why Cheap Software Alone Is Not the Answer
HMRC does not provide its own MTD software for Income Tax. Instead, taxpayers must choose from compatible third-party software. HMRC says there are free and paid options, but software being “compatible” does not mean it will choose the right treatment for you, keep you fully organised, or make the best tax decisions on your behalf.

This is where many people will get caught out.
Software can help you enter figures.
It does not replace judgement or tax knowledge and experience - which saves you tax.

It does not tell you:

• whether an expense is safe to claim
• whether something should be capital or revenue
• whether your rental records are complete
• whether your drawings, personal use, repairs or improvements are being treated correctly
• whether your quarterly data is sensible before it goes to HMRC

Cheap software may look attractive at the start, but if the bookkeeping is poor or the tax treatment is wrong, it can cost far more later in stress, overpaid tax, missed claims, corrections and HMRC problems.

Why Using Tax Affinity Is the Smarter Option
The best approach for most landlords and self-employed people is not to struggle through this alone and hope for the best.
It is to get the system set up properly from the start.

At Tax Affinity Accountants, we do not just tell clients to buy software and get on with it. We help make the whole process practical, compliant and manageable.

That means we can help you:

• work out whether MTD applies to you
• check the correct threshold based on your income
• set up the right process and software approach
• keep records properly from the beginning
• review the figures before they go to HMRC
• help make sure your tax position is calculated as accurately and tax-efficiently as possible based on your records and circumstances
• reduce the risk of mistakes, missed claims and bad habits becoming expensive problems later

For many people, that is the real value.
Not “having software”.
Having the right accountant behind the software.

A Simple Step-by-Step Plan

Step 1: Check if you are in scope
Look at your 2024/25 gross income from self-employment and property. If the combined figure is over £50,000, you should be preparing now for April 2026.

Step 2: Do not wait for panic season
If you leave this until the last minute, you are far more likely to choose the wrong process, keep poor records and end up stressed by the first quarterly deadline.

Step 3: Get your bookkeeping method sorted
You need a clean digital method that works in real life, not just in theory. HMRC says you need compatible software, but choosing software is only one part of getting ready.

Step 4: Let a specialist review your position
This is especially important if you have:

• both rental and self-employed income
• joint property income
• more than one property
• irregular income
• poor historic bookkeeping
• uncertainty over what to claim

Step 5: Let Tax Affinity handle it properly
The safest route is to let an experienced accountant set the system up, review the records and manage the compliance process with you.

What About Penalties?
HMRC has announced an easement for those who are mandated into MTD from April 2026: it will not apply penalty points for late quarterly updates for the first 12 months. But that does not mean quarterly updates can be ignored. HMRC still requires them, and they must be submitted before the year-end process can be completed. Penalties can still apply for late tax returns and late payment.

So the message is simple:
Do not confuse “temporary softening of penalties” with “this is not important.”

It is important.

Very.

Does This Apply To Limited Companies?
No. HMRC’s current MTD for Income Tax rollout from April 2026 is for sole traders and landlords in scope, not limited companies. Partnerships are expected to be brought in later, but they are not part of the April 2026 start.

Final Thought: This Is Not the Time to Wing It
This change is coming.
HMRC has confirmed that it is going ahead from 6 April 2026, and it has already said that hundreds of thousands of sole traders and landlords will be affected.
For some people, MTD will be manageable.
For others, it will become a cycle of missed deadlines, messy records and frustration.
The difference will often come down to one decision:

Do you try to patch it together yourself with cheap software, or do you get it set up and reviewed properly from the start?

At Tax Affinity Accountants, we help landlords and self-employed clients make this transition in a way that is clear, controlled and tax-efficient.

Speak to Tax Affinity Before April 2026
If you are a landlord or self-employed and think the new MTD rules may apply to you, now is the right time to act.

We can help you:

• confirm whether you are affected
• prepare your records
• put the right process in place
• avoid confusion and unnecessary stress
• make sure your figures are handled properly rather than left to cheap software or guesswork

Contact Tax Affinity Accountants today and let us help you get ready properly.

About the Author
Written by Anni Khan, Tax Affinity Accountants
Reviewed by Andrew Khan, Principal Accountant, Tax & Forensic Accounting Specialist, Recognised tax agent authorised to act on clients’ behalf with HMRC.

Tax Affinity Accountants are UK-based tax and accountancy specialists supporting individuals and SME businesses. With offices in Worcester Park, Kingston upon Thames, and Epsom & Ewell, they act for clients across the UK and internationally, providing compliant, HMRC-focused tax advice and support. For more information, visit www.taxaffinity.com or read more insights at www.taxaffinity.com/blog.

Important Notice
This article is for general information purposes only and does not constitute personalised tax advice. Tax treatment depends on individual circumstances. Professional advice should be sought before taking action.

#MTD #ITSA, #MakingTaxDigital, #HMRC, #Landlords, #SelfEmployed, #SoleTraders, #IncomeTax, #QuarterlyUpdates, #April2026, #TaxAffinity, #PropertyTax, #SelfAssessment #accountant 

As we close the books on December and January, Tax Affinity Accountants couldn’t be prouder of the incredible results we delivered for our clients during this crucial period. The Self Assessment deadline for HMRC has come and gone, and once again, our clients are experiencing the benefits of working with a team that not only meets deadlines but ensures the best possible tax outcomes. Our firm’s dedication to providing personalized, efficient, and effective tax services has proven to be invaluable during one of the busiest times of the year.

The numbers are in, and we’ve exceeded expectations across the board. With the highest number of referrals in our history, we are humbled by the trust our clients continue to place in us. Our reputation for delivering outstanding results has never been stronger, and as a result, more and more people are turning to Tax Affinity Accountants for expert guidance on how to save on taxes and maximize their hard-earned money.

In this post, we’ll explore how Tax Affinity Accountants rose to the occasion during the Self Assessment season, the satisfaction our clients enjoyed, and why now is the perfect time to consider switching to a tax team that actually understands your needs and can put you on the path to better tax outcomes.

The HMRC Self Assessment Deadline: A Busy Period for Accountants and Taxpayers Alike
The Self Assessment tax return deadline for HMRC is one of the most significant dates in every freelancer, contractor, sole trader, and small business owner’s calendar. As many people know, the 31st of January is the final day for submitting tax returns for the previous financial year, and the stress of meeting that deadline can be overwhelming. With penalties for late submissions and the risk of costly errors, it’s no surprise that many individuals and businesses turn to professional accountants for help.

This past December and January, our team at Tax Affinity Accountants worked tirelessly to ensure that our clients’ tax returns were submitted accurately and on time. Our expert accountants handled a wide range of complex scenarios, from straightforward self-assessments to more intricate tax situations involving multiple income streams, investments, property portfolios, and international tax issues. Regardless of the complexity, we ensured that all our clients received tailored advice and support to help them navigate the Self Assessment process with ease.

Our clients benefit from the comprehensive knowledge we have of current tax laws, and we worked diligently to ensure they understood their obligations while also taking advantage of every allowable deduction and relief available. The peace of mind that comes with having experienced professionals in your corner during such an important and stressful time cannot be overstated.

Client Delight: Low Taxes, Timely Returns, and Maximum Savings
What sets Tax Affinity Accountants apart from other tax firms is our commitment to delivering the best possible outcomes for our clients. Throughout December and January, we received glowing feedback from individuals and businesses who were delighted with the results we achieved for them.

By applying our deep expertise in tax planning and optimization, we were able to significantly reduce the tax liabilities of many clients. This is what truly excites us—helping individuals keep more of what they’ve earned. Whether it’s taking full advantage of allowable tax deductions, advising on tax-efficient investments, or utilizing strategies to minimize National Insurance contributions, we’re always looking for new and creative ways to reduce our clients’ tax burdens.

One example involved a small business owner who had previously been using a generic online tax software to file their returns. While the software was quick, it didn’t provide them with the tailored advice they needed to make the most of their tax position. After switching to Tax Affinity Accountants, we identified numerous opportunities for tax savings, including business expenses they had overlooked and potential claims for tax relief that they didn’t know about. As a result, the business owner’s tax bill was reduced by a significant amount—enough to reinvest in their business, expand operations, and increase profits.

We’ve also worked with several high-earning individuals who were struggling with their tax obligations. By applying a strategic approach to tax planning and ensuring they understood the implications of different income streams, we were able to optimize their tax position and save them thousands of pounds. When clients come to us seeking clarity and guidance, we don’t just meet their needs; we exceed them, delivering tax returns that maximize their savings while ensuring full compliance with HMRC.

At Tax Affinity Accountants, our clients are the center of everything we do. The positive feedback and appreciation we received during the January rush are a testament to the hard work we put in and our unwavering commitment to providing top-notch service. Our clients know they can count on us to not only meet the deadlines but also to deliver the best tax outcomes.

The Highest Number of Referrals in Our HistoryOur clients don’t just trust us—they recommend us to their friends, family, and colleagues. During the December and January rush, we received an unprecedented number of referrals, making it clear that our reputation for delivering outstanding results is growing faster than ever.

Referrals are the highest compliment we can receive, and we take great pride in knowing that our clients are not only satisfied with our services but are so confident in our ability to help others that they actively refer us to people they know. It’s also a sign that more and more individuals and businesses are realizing the value of working with an accountant who genuinely understands their financial goals and strives to help them save on taxes.

This year’s increase in referrals is a direct reflection of the exceptional results we consistently achieve for our clients. From freelancers and contractors to business owners and high-net-worth individuals, we’re proud to be the trusted partner that so many people turn to for expert tax advice. And as our client base continues to grow, we’re excited to help even more people take control of their tax positions and keep more of their hard-earned money.

Why Switch to Tax Affinity Accountants?
If you’re currently working with an accountant who isn’t delivering the results you expect or feel that your tax bills are higher than they should be, now is the perfect time to make the switch to Tax Affinity Accountants. Here’s why:

1. Unmatched Expertise
   At Tax Affinity Accountants, we specialize in providing strategic tax planning advice. We’ve spent years honing our knowledge and experience to ensure that our clients always receive the best possible outcomes. From minimizing tax liabilities to optimizing financial strategies, our team is second to none when it comes to maximizing your savings.
2. Timely and Accurate Returns
   Meeting the Self Assessment deadline is just the beginning. We guarantee that your tax returns will be submitted accurately and on time, eliminating the stress of penalties or late fees. We handle everything, so you can focus on what matters most—growing your business or enjoying your life.
3. Personalized Service
   No two clients are the same, and we don’t offer a one-size-fits-all solution. We take the time to understand your unique situation, goals, and challenges, tailoring our services to meet your specific needs. Whether you’re an entrepreneur, freelancer, or high-net-worth individual, we have the expertise to help you thrive.
4. Maximized Tax Savings
   Our clients consistently enjoy lower tax bills, thanks to our meticulous approach to tax planning. By identifying every potential tax-saving opportunity, we ensure that you’re not paying more than necessary. When you work with Tax Affinity Accountants, you can rest assured that you’re getting the best possible tax outcome.
5. Trusted by Clients Across London
   With more referrals than any other London-based tax accountant, our reputation speaks for itself. Our clients trust us because we deliver results. Don’t settle for an accountant who doesn’t understand your needs—make the switch to Tax Affinity Accountants and see the difference for yourself.

Ready to Save on Taxes and Keep More of Your Money?
If you’re ready to take control of your taxes and start working with a firm that truly understands how to maximize your savings, Tax Affinity Accountants is here to help. With our team of experts by your side, you’ll never have to worry about missed deadlines, unnecessary penalties, or overpaid taxes again.

Don’t let another year go by paying more than you need to. Reach out to us today for a consultation and discover how much we can help you save. Whether you’re switching from another accountant or looking for a new tax partner, Tax Affinity Accountants is here to provide the expert service, advice, and savings you deserve.
Contact us now, and let’s start working on a tax strategy that works for you. Together, we’ll make this year the best one yet!

Disclaimer: Tax Affinity Accountants is a leading accounting firm specializing in tax planning, advice, and compliance services. We work with individuals, freelancers, contractors, business owners, and high-net-worth individuals across the UK to help them maximize their tax savings and optimise their financial strategies. Please visit www.taxaffinity.com to learn more about our services and book a consultation.

By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

On 6th March 2024 the UK Chancellor announced the Spring Budget for the UK. There were quite a few positive changes and the main points to help plan ahead are below:

Child Benefit Changes
Starting April 2024, parents will receive Child Benefit as follows: £25.60 per week (£1,331 annually) for the eldest child and £16.95 per week (£881 annually) for additional children.
Presently, if either parent's income exceeds £50,000, the High Income Child Benefit Charge (HICBC) takes effect, requiring repayment of Child Benefit once income surpasses £60,000. This necessitates completing a self-assessment tax return.

As of April 6, 2024, the threshold rises to £60,000 with a gradual taper, fully recouping Child Benefit when income exceeds £80,000. By April 2026, the clawback assessment will shift to a "household income" basis, pending HMRC adjustments.

The 2024 threshold increase will lower the combined tax rate (HICBC, income tax, and NIC) on incomes above £60,000, encouraging parents to earn more. Eventually, transitioning to a "household income" basis should create fairer outcomes for families, albeit HMRC implementation challenges may arise.

Changing the Non-Domiciled (non-dom) status and tax treatment
The government plans to end the current tax treatment for UK resident non-domiciled individuals (non-doms) starting April 6, 2025. This regime, in place for over 200 years, allowed UK residents with permanent homes abroad to avoid UK tax on foreign income and gains (FIG) unless brought into the UK. It also shielded non-UK assets from Inheritance Tax.

As of April 6, 2025, the current remittance basis will be replaced by a new residence-based test lasting four years for those who have been non-UK residents for at least the prior ten tax years. During this period, newcomers won't pay tax on foreign income or trust distributions brought into the UK. However, they'll lose personal allowances and CGT exemptions.

After four years, individuals will be taxed like other UK residents on worldwide income and gains.
Transitional rules apply: non-doms moving from remittance to arising basis in 2025/26 will be taxed on 50% of foreign income; reduced rates for pre-6 April 2025 FIG remittances till 2027; and Capital Gains Tax rebasing for non-UK assets. Business Investment Relief continues.
From April 6, 2025, settlor-interested trusts lose tax protection unless they qualify for the four-year FIG regime. Overseas workday relief remains for the first three years, depending on opting into the new regime.

Inheritance Tax shifts from domicile to residence-based from April 6, 2025, with assets within ten years of UK residency potentially liable. UK sited assets remain subject to IHT.
These changes simplify the non-dom tax system, but complexities persist. Transitional provisions offer time for adjustment. Current non-doms should consult their Tax Affinity adviser promptly as these are significant changes.

National Insurance
Class 1 Changes (Employed)
Starting from an annual income of £12,570 up to £50,270, employees pay Class 1 National Insurance Contributions (NICs). The rate is currently 10% (down from 12% since January 6 this year). Above £50,270, the rate remains 2% for additional earnings.
From April 6, 2024, the main rate will decrease by another 2% to 8%, potentially saving employees up to £63 monthly (£754 yearly). Employers' NICs, at 13.8% over the lower threshold, remain unchanged.

This reduction benefits employees and may ease pressure on employers regarding wage hikes.

Self-Employment Changes
Self-employed individuals pay Class 4 NICs from £12,570 to £50,270 at 9% (dropping to 8% from April 6, 2024). Above this threshold, the rate stays at 2%.

Starting April 6, 2024, the rate decreases by another 2% to 6%. This saves £30 for every £1,000 of profit, up to £1,131 annually for those paying at the main Class 4 NIC rate. Class 2 NICs were abolished from April 6, 2024, offering a positive financial change for the new tax year.

Capital Gains Tax
When you sell residential property and make a profit, you might owe Capital Gains Tax (CGT), except when it's your main home, which is CGT exempt. If the property wasn't always your main home, only part of the gain is taxable.

Currently, residential property gains are taxed at 18% for basic rate band profits and 28% thereafter. Starting April 6, 2024, the higher rate reduces to 24% for property sales.
Reporting the sale within 60 days from completion is crucial. Sales exchanged before April 6, 2024, may still be taxed at 28%.

Landlords affected by the abolishment of Furnished Holiday Lets tax benefits from April 2025 will see changes. From April 6, 2025, furnished holiday lettings will be treated as property investment businesses, losing several tax benefits:

• Interest on loans for furnished holiday lettings will no longer be deductible but will receive a 20% tax credit.
• Capital gains will be subject to CGT rates, losing business asset disposal relief.
• CGT rollover relief and capital allowances will be withdrawn.
• Tax relief for pension contributions may require adjustments.

These changes impact property owners and landlords, requiring careful consideration and possibly seeking advice.

Investments
The Budget introduced measures to encourage individual investing and foster a stronger savings culture. Here are the key points:

1. UK ISA Consultation:
   • The government is considering a new UK ISA with a £5,000 allowance, in addition to the existing £20,000 allowance.
   • The consultation, open until June 6, 2024, seeks input on defining eligible investments for the UK ISA.
   • ISAs offer tax-free savings, potentially benefiting higher earners amidst frozen tax thresholds.
2. NS&I British Saving Bond:
   • NS&I will launch a British saving bond in early April 2024, offering a fixed interest rate for three years on investments ranging from £500 to £1 million.
   • Investors can choose between growth bonds and income bonds, each with different tax implications.
   • Bonds from NS&I are backed by HM Treasury.
3. NatWest Share Sale:
   • The government plans to sell part of its NatWest shareholding directly to individual investors, aiming for full divestment by 2025/26.
   • The sale may occur this summer, subject to market conditions.

It's advisable to seek independent investment advice before making any investment decisions.

VAT threshold increased
The government is raising the VAT registration threshold from £85,000 to £90,000 and the deregistration threshold from £83,000 to £88,000. These changes start on April 1, 2024. Over 28,000 businesses are expected to benefit by no longer needing to register for VAT in 2024-25.

Conclusion
Overall this is a much better budget than the previous autumn one presented in 2023. VAT announcement is decades overdue and the drop in NI thresholds don't make that much of a real world difference when price rise percentage is way higher then the percentage drop. And again the goverment did not address any of the large multinationals raking huge profits while small businesses and the public suffer. The sale of Natwest shares in a recession (that the government used tax payers money to bail out the bank recently) needs to be critically analysed more closely as to the effective timing of the sale and real time benefit for tax payers who directly paid for this out of their pockets. At times like these its even more important to have an experience and knowledgable tax accountant in your corner.

By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

 
UK Chancellor, Kwasi Kwarteng announced a series of tax cuts & changes in his mini-budget on 23rd Sept 2022, and yesterday did a U-turn on cancelling the drop from 45% to 40% on the highest tax rate.

A quick list of how the mini-budget will affect tax payers is listed below:

1. Income taxes
The top rate of income tax for those earning more than £150,000 per annum was reduced from 50% to 45% by a previous Chancellor in 2013 this was planned to be lowered to 40% but has now been cancelled by the government U-turn and will remain at 45%.

From 6th April 2023 the rate of income tax on income between £12,571 & £50,270 per annum will be reduced from 20% to 19%.

2. National Insurance reversal
Chancellor confirms the 1.25 percentage national insurance rise introduced earlier this year by the previous Chancellor will be cancelled from 6th November 2022 i.e. from December’s payslip onwards.

3. Stamp duty cut
Before there was no stamp duty to pay on the first £125,000 of a property’s value. It has now been doubled to £250,000.

The no stamp duty threshold for first-time buyers will rise from £300,000 to £425,000.
The max property value for first-time buyers’ stamp duty relief will rise from £500,000 to £625,000.

4. Corporation tax stays at 19%
Corporation tax rises have been scrapped, the previous Chancellor Rishi Sunak announced that the rate of corporation tax would be increasing from 19% to 25%, from 6th April 2023.

So now businesses with profits below £50,000 will stay at the 19% rate, as well as businesses with profits over £250,000 that were meant to pay 25% rate ie everyone stays at 19%.

5. Changes to IR35
From 6th April 2023, the previous IR35 rules introduced in 2017 and 2021 have been reversed. Allowing individuals to contract instead of work as employees again ie self employed off-payroll working through a limited company.  The changes mean its up to the contractors themselves to make sure they have the right status and are paying the right amount of tax instead of putting the burden on employers.

6. Strikes legislation
The government says it will legislate to stop “militant trade unions” from closing down key infrastructure through strikes.

The laws will require unions to put pay offers to a member vote, to ensure strikes can only be called once pay talks have genuinely broken down, he says.

7. Investment zones
The government confirmed that almost 40 investment zones will be created with tax breaks for businesses. Areas included are the West Midlands ,Tees Valley, Norfolk and the west of England etc.

8. Energy Bills
Freeze household energy bills at £2,500 for a typical household and a price cap on energy bills for commercial properties also.

9. Investment
(AIA) Annual investment allowance, the total amount a company can invest tax free, stays at £1 Million.
 
New & start-up companies are able to raise up to £250,000 under a scheme giving tax relief to investors in their business

Share options for (PAYE) employees doubled from £30,000 to £60,000

10. Bankers’ bonuses
Chancellor confirms the bankers’ bonus cap will be scrapped.

By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

 HMRC relishes the idea that tax payers will make errors in their tax returns and then they will pay higher taxes or be fines for making errors. The number of errors by members of the public doing their own self assessments has been rising steeply in the last few years and HMRC has been raking in fines for errors. So its very important to try to ensure you make none.

Why? - Well simply mistakes on your tax returns could cost you a lot of hard earned money.
Solution? - Avoid HMRC penalties and charges by making sure you don’t commit these mistakes during tax return time by getting an expert like Tax Affinity Accountants (one the most highly recommended accountants in the UK) to do calculate and submit the return for you and sleep easy at night knowing you paid the least tax and everything was correct according to HMRC rules.

Key things to keep in double check:

1. Numbers / digits errors. Whether it’s a National Insurance or Unique Tax Reference (UTR) number for income, incorrect numbers on any form could cost you. Be mindful when entering bank account information when opting for refund. The last thing you want is for someone else to receive your refunds. You should double check all numbers entered on your tax returns. 
   
2. Maths errors. Many taxpayers use pen an paper to work out numbers for submission. Even if you use a software package, it will still not catch errors for incorrect data entry. You should double check your numbers and then double check your calculations each time. 
   
3. Not declaring all the earned income. You must, must report all earned income on your tax return. When HMRC find out that you did not report everything, you could owe interest and penalties in addition to the tax owed on that income. UK banks these days can report income to HMRC without the account holders knowledge.
   
4. Not staying up to date with your tax code. Check the latest changes to your tax code before filing your own tax return. New laws affect many taxpayers and they are constantly changing. 
   
5. Filing an incorrect status. With many different filing status options available, the most accurate one for a taxpayer’s situation may not be easy to use. Each filing status could have an impact on the tax liability due to HMRC.
   
6. Mismatched names. This is a common mistake for newlyweds, typically when the wife takes a new last name and has not notified the NI department. Same issue may pop up for same sex marriages. The opposite applies also for divorcees who need to have a name change notified . If your name does not match the name and NI number and HMRC has on file, the tax return could be rejected or a tax refund could be delayed.  
   
7. Declaring multiple country taxes. Don’t forget that income earned in another country must be reported. If you reside in one state and work in another, a non-resident tax return must be filed in the country in which you work. Only the money earned in that country needs to be reported. However, if you fail to declare this, you could face interest and penalties, in addition to the taxes owed. 
   
8. Falling for tax schemes. One of the biggest concerns for the HMRC is tax fraud and identity theft. Taxpayers have lost thousands of pounds because criminals tricked them into believing they owed HMRC. HMRC will never send an unsolicited email or contact you through social media. HMRC does not ask for personal or financial information. If you believe you may be at risk for identity theft, you should contact the HMRC immediately along with your banks etc. 
   
9. Missing deductions or credits. While penalties and fees mentioned above could cost you, missing a deduction or tax break could cost you by lowering a refund or increasing taxes. 
   
10. Forgoting to sign and date the forms. It is an all-too-common mistake to forget to sign and date. While this may not cost you money, it will cause a delay in receiving any anticipated tax refund. Especially for those who owe HMRC and wait until the very last minute to file, forgetting to sign and date could cost you a late fee and penalty when HMRC sends it back for signature and the deadline has passed. 
    

A good tax accountant should save you much more in tax than what he/she charges. And having a Tax Affinity accountant calculate your personal and business tax situation will lead to zero mistakes on your return and a lower tax bill first time every time. Fill out our contact us page to find an office near you and we will be happy to help you sleep easier at night.

 By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts Business, Tax and Accountancy. With branches in Worcester Park and Kingston upon Thames and Epsom and Ewell they are considered in the Industry to be expert business accountants and tax advisors for both individuals and small & medium sized businesses (SME's). Helping and supporting both individuals and limited company owners / self employed people throughout the UK and the world, they regularly help clients grow their business providing tailored advice and support. Their support has been considered invaluable by many clients and key to their success.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

As the dust settles after Chancellors October Budget 2018. We felt nearly all of the news coverage by journalists had presented little or no perspective specifically for the self employed and small and medium sized businesses. So to help below is another one of our famous main points lists, because lifes to short to waffle :

1. Corporation tax will fall to 17% in 2020.
   
2. Personal tax free allowance will be £12,500 and the Higher rate tax band will rise to £50,000 from April 2019, one year earlier than planned. The threshold will remain at the same level in 2020-21 and then increase by CPI
3. New structures and buildings allowance and a temporary increase in the Annual Investment Allowance now up to £1 million.
4. New tax on plastic packaging which does not contain enough recycled content.
5. Introduced over 100 measures to crack down further on avoidance, evasion, aggressive tax planning and unfair outcomes
6. Off-payroll working in the private sector IR35 to be extended this change will not be introduced until April 2020. Small organisations will be exempt, minimising administrative burdens.
7. The government will not abolish Class 2 NICs as previous said.
8. Trusts consultation, the government will publish a consultation on taxation of trusts, to make the taxation of trusts simpler and more transparent.
9. Charity taxes - increasing upper limit for trading that charities can carry out without incurring a tax liability from £5,000 to £8,000 where turnover is under £20,000, and from £50,000 to £80,000 where turnover exceeds £200,000
10. Lifetime allowance for pensions – increase for 2019-20, rising to £1,055,000.
11. Adult ISA annual subscription limit for 2019-20 will remain unchanged at £20,000. The annual subscription limit for Junior ISAs for 2019-20 will be uprated in line with CPI to £4,368.
12. The annual subscription limit for Child Trust Funds for 2019-20 will be £4,368.
13. Structures and buildings allowance (SBA) – New non-residential structures and buildings will be eligible for a 2% capital allowance where all the contracts for the physical construction works are entered into on or after 29 October 2018.
14. The capital allowances special rate for qualifying plant and machinery assets will be reduced from 8% to 6%.
15. Entrepreneurs’ Relief: minimum qualifying period from 6 April 2019 the minimum period throughout which the qualifying conditions for relief must be met extended from 12 months to 24 months.
16. Directly taxing offshore entities that realise intangible property income in low-tax jurisdictions, rather than through applying a withholding tax
17. Royalties and income from the indirect exploitation of intangible property in the UK market through unrelated parties to be a target for investigation
18. Cutting bills for retail properties with a rateable value below £51,000
19. Business rates public lavatories 100% business rates relief for all public lavatories to help keep these important local amenities open
20. Business rates local newspaper discount – £1,500 business rates discount for office space occupied by local newspapers in 2019-20.
21. Stamp Duty Land Tax (SDLT) and first-time buyers relief – The government will extend first-time buyers relief in England and Northern Ireland so that all qualifying shared ownership property purchasers can benefit, whether or not the purchaser elects to pay SDLT on the market value of the property. This change will apply to relevant transactions with an effective date on or after 29 October 2018, and will also be backdated to 22 November 2017 so that those eligible who have not previously claimed first-time buyers relief will be able to amend their return to claim a refund.
22. Consultation on SDLT charge for non-residents - government will publish a consultation in January 2019 on a SDLT surcharge of 1% for non-residents buying residential property in England and Northern Ireland.
23. Capital gains tax - from April 2020 lettings relief only applies in circumstances where the owner of the property is in shared occupancy with the tenant. The final period exemption will also be reduced from 18 months to 9 months. The government will consult on these changes. There will be no changes to the 36 months final period exemption available to disabled people or those in a care home.
24. Vehicle Excise Duty (VED): Uprating – From 1 April 2019 VED rates for cars, vans and motorcycles will increase in line with RPI.
25. Company vehicles – From 6 April 2019 fuel benefit charges will increase in line with RPI and the van benefit charge will increase in line with CPI.
26. Air Passenger Duty (APD) – Short-haul APD rates for 2020-21 will not rise, Long-haul rates will increase in line with RPI. The rates for long-haul economy will increase by £2, and the rates for those travelling in premium economy, business and first class will increase by £4. Those travelling long-haul by private jets will see the rate increase by £13.
27. Tax on the production and import of plastic packaging from April 2022 and is subject to consultation.
28. Alcohol duty rates and bands – Duty rates on beer, most cider and spirits will be frozen. Duty on most wine and higher strength sparkling cider will rise by RPI inflation from 1 February 2019. The government will review the current Small Brewers Relief to ensure it is supporting growth in the sector. (12)
29. Vaping ie Tobacco for heating - government will legislate in Finance Bill 2018-19 for a new duty rate for tobacco for heating. In these products processed tobacco is heated (but not burned like conventional tobacco) to produce, or flavour, vapour. This will be set at the same level as hand rolling tobacco and take effect on 1 July 2019.
30. VAT threshold will be maintained at the current level of £85,000 for a further 2 years until April 2022. The government will look again at the possibility of introducing a smoothing mechanism once the terms of EU exit are clear.
31. VAT fraud in labour provision in the construction sector – government will introduce a VAT domestic reverse charge to prevent VAT losses through so-called ‘Missing Trader’ fraud. This occurs when traders collect VAT on their sales but go missing before passing that VAT on to HMRC. The new rules will have effect on and after 1 October 2019 and the government is publishing secondary legislation alongside the Budget to implement this change.
32. Alternative method of VAT collection: ‘split payment’ – To reduce online VAT fraud by third country sellers and improve how VAT is collected on cross-border e-commerce, the government is looking at a split payment model.
33. EU exit - Consequential minor amendments to tax legislation to reflect EU exit – The government is responsible for preparing for all possible outcomes to EU negotiations. This power will allow the government to make small, essential changes to UK tax law to maintain the effect of tax legislation if the UK leaves the EU without a deal. Changes made under this power will maintain current operation of the tax law in essential areas, including changes in line with no deal legislation in other parts of the law.
34. Tax avoidance and evasion, aggressive tax planning and non-compliance to continue.
35. Capital gains tax: tackling misuse of Entrepreneurs’ Relief – In addition to the current requirements on share capital and voting rights, from 29 October 2018 shareholders must also be entitled to at least 5% of the distributable profits and net assets of a company to claim the relief. This is to address an identified abuse of the current rules.
36. Profit fragmentation – As announced at Autumn Budget 2017, the government will legislate in Finance Bill 2018-19 to introduce targeted legislation that aims to prevent UK businesses from avoiding UK tax by arranging for their UK-taxable business profits to accrue to entities resident in territories where significantly lower tax is paid than in the UK. The taxable UK profits will be increased to the actual, commercial level.
37. Reforming Stamp taxes on shares consideration rules – From 29 October 2018, a targeted market value rule will be introduced for listed shares transferred to connected companies to prevent forestalling.
38. Preventing abuse of R&D tax relief for small and medium-sized enterprises (SMEs) – From 1 April 2020, the amount of payable R&D tax credit that a qualifying loss-making company can receive in any tax year will be restricted to three times the company’s total PAYE and NICs liability for that year. This will ensure the relief is robust against identified abuse, including fraud, following the prevention by HMRC of fraudulent claims worth £300 million.
39. Protecting your taxes in insolvency – From 6 April 2020, when a business enters insolvency, more of the taxes paid in good faith by its employees and customers, and temporarily held in trust by the business, will go to fund public services rather than being distributed to other creditors. This reform will only apply to taxes collected and held by businesses on behalf of other taxpayers (VAT, PAYE Income Tax, employee NICs, and Construction Industry Scheme deductions). The rules will remain unchanged for taxes owed by businesses themselves, such as Corporation Tax and employer NICs.
    
40. Tax abuse and insolvency – Following Royal Assent of Finance Bill 2019-20, directors and other persons involved in tax avoidance, evasion or phoenixism will be jointly and severally liable for company tax liabilities, where there is a risk that the company may deliberately enter insolvency.
41. National insurance threshold will rise - not mentioned in the Chancellor's speech but in the budget papers - where we got our info from. This rises from £8160 in 17/18 to £8424 in 18/19 and £8632 in 19/20.
42. Premuim bond minimum savings amount will drop - from £100 to £25.
43. National living wage rise from April 19 - for over-25s will rise to £8.21 per hour from £7.83 per hour.
44. Annual ISA allowance will remain at £20,000 in 2019/20 for adults – the annual allowance for Junior ISAs will rise in 2019/20 to £4,368
    

By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Surbiton , Worcester Park , Kingston upon Thames , Cheam and Epsom they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice and support.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

Thousands of reminder letters from HMRC have begun to drop on across door steps in the UK. The tax year ended 5/4/17 ie 2016 -2017 self assessment is now due to be completed and the sooner you do it the sooner you can get a refund of income tax or know how much you need to save and pay.

If you already have a personal UTR - unique tax number then the letter may have already arrived or will be on its way. If you do not then you may need to ensure you or your accountant has applied for one to allow for its submission.

Who needs to do a tax return?

You’ll need to have a personal tax return calculated and submitted if, in the last tax year:

• you were self-employed in a previous tax year, or had income in any capacity other than employed ie income from overseas, property, dividends, sale of investment property or assets etc
• you received more than £2,500 in untaxed income, for example from tips or renting your property etc - if you received less than £2,500 you may still have to complete a tax return
• you received income from your savings / investments which was £10,000 or more before tax
• your income from dividends from shares and investment portfolio's was £10,000 or more before tax
• you made profit(s) from selling things like shares, a second home or other assets and need to pay capital gains tax to HMRC
• you were the director of a limited company registered at Companies House - unless it was for a non-profit organisation (limited by guarantee or registered charity) and you have not been paid or received any benefits, like a company car, medical cover, gym, travel, company phone etc
• your income (or your partner’s) was over £50,000 and one of you claimed child benefit in the tax year 16/17
• you have had some income from abroad that you needed to pay tax on - the money need not be exchanged into Pound Sterling or come into the UK for it still to be taxable
• you lived abroad and had a UK income - which more than likely was declared as non-domiciled income and therefore not tax correctly eg rental property and overseas landlord
• your employed income was over £100,000 - eg higher earner with possibly a P11d also
• you were a trustee of a trust and/or registered pension scheme - and therefore like a company director are required to clarify your tax position each year
• you had a P800 form posted to you from HMRC saying you may not have paid enough tax last year - could be due to your tax code not deducting the correct amount of tax
• you fall into a certain category of worker eg religious minister or Lloyd’s underwriter etc
• if you’ve been told to submit a tax return by HMRC - even if it just an email not a letter

If your not sure contact an experienced quality accountant like Tax Affinity Accountants and they would be happy to advise.

By Anni Khan at Tax Affinity Accountants

Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting self employed people throughout the UK, they regularly help clients grow their business providing tailored advice.

For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.

Deadline: 31/10/16 for Paper Tax Returns

For everyone already registered with HMRC for the tax year 6/4/15 to 5/4/16 they are required to submit their paper tax return by the 31st October 2016. And then to pay all tax and National Insurance payments for that period by the 31/1/17.

So if you have to declare a tax return for 2015/16 year then we urgently recommend you contact a reputable and experienced tax accountant like Tax Affinity Accountants (one of the most highly recommend companies in the accounting industry) as soon as possible.

It is of course possible to submit a tax return yourself and HMRC will direct you to do this, but what they purposefully fail to clarify is what various expenses and industry specific allowances are allowed to be claimed as legitimate deductions to help decrease your tax bill.

And a good accountant, as any successful business person will tell you, is usually worth his/her weight in gold when it comes to getting your numbers right and paying the correct and least amount of tax.

At Tax Affinity Accountants our motto is that 'an accountant should legally save you far more in tax than they should ever be charging for their service' ensuring every client gets the very best service at a fair and reasonable cost. So our service more than pays for itself for all our clients.

So if you have to do a 2015/16 tax return (or any other year) and would like us to help you. Or are already one of our very satisfied customers then please get in touch with us as soon as possible and avoid the late rush and have the most time put into your accounts.