As one tax year ends another begins, and big tax changes are coming! The government is in the process of digitalising the UK tax system and Making Tax Digital for Income Tax (MTD for IT) will come into effect in April 2026. It will totally change the way landlords and self-employed people earning above £50,000 have to submit their income tax returns: sending quarterly updates using MTD-compatible software. For those still using paper and spreadsheet based record keeping, this will require switching to electronic accounting systems. 

If you're affected, have a chat now with Lymington Accountants Cloud Eleven. With the software and expertise in place to make transition to MTD as smooth as possible, Jan Willis and her team are ready and waiting to help you. You can also sign up for relevant email updates over the coming months. Get prepared and get used to the new systems now while you don't have to, rather than waiting until it becomes a legal necessity!

Making Tax Digital is coming: be ready with Cloud Eleven Accountants

There are a lot of tax changes coming up which may affect you and your business.  Today we are focussing on the Government’s roll out of Making Tax Digital – what it is, who it affects and what you need to do.

Why

HMRC are rolling out the first phase of Making Tax Digital for Income Tax next year, the latest step in the government’s plan to modernise the UK tax system.

Who

From April 2026, sole traders and landlords with an annual income above £50,000 will need to comply with new regulations, including keeping digital records and submitting quarterly updates to HMRC using MTD-compatible software.  Sole traders and landlords with lower incomes will be come into the scheme from 2027.

You’ll need to use Making Tax Digital for Income Tax from 6 April 2026 if all of the following apply.

You:

• are an individual registered for Self-Assessment
• get income from self-employment or property, or both, before 6 April 2025
• have a qualifying income of more than £50,000 in the 2024 to 2025 tax year

When

MTD returns begin in April 2026 but preparations need to be made now!  If you have sole trader or rental income on your self-assessment tax return and think this may affect you, now is the time to beat the rush and get organised! 

Getting prepared now with a professional adviser such as Cloud Eleven Accountants will help reduce the stress and hassle of submitting your figures to HMRC.

What

There isn’t much time to prepare.

While the regulations don’t come into effect until April 2026, it’s important to prepare early so you have time to transition to digital tools and know what’s required of you to comply with MTD.

How

Sole traders and landlords who are included in this will be expected to keep digital records of income and expenses and submit quarterly updates to HMRC using authorised software.  Information regarding sole trader and landlord income will need to be submitted to HMRC quarterly (four times per year) as well as submitting a final self-assessment tax return.

Getting organised now will make self-assessment easy!  As your information and records are dealt with quarterly, completing a year end return is much easier as most of the information is already recorded.  You can work with your accountant to make any adjustments or additions to your tax return and get it filed easily ahead of the HMRC deadline.  No more last-minute scramble for a year’s worth of information!

We can help you with this!  Cloud Eleven Accountants have the software and expertise in place to make transition to MTD as smooth as possible.  If you are concerned that this will affect you and need some guidance, please get in touch….

Watch this space for more updates on Government changes to tax and finance this year.

Cloud Eleven Accountants Lymington

People buy from people, so please meet Jan Willis.

Jan has built a small friendly team to support the accountancy requirements of her growing client base, locally in Lymington and the New Forest, and further afield across the UK too.

All businesses and individuals have one thing in common – they are all different!

Cloud Eleven celebrates this uniqueness and is there to support clients whatever their business sector, helping them to make informed decisions based on understanding their numbers and taxation.

Call Jan now to book a no commitment discussion about the accountancy needs of your business: 01590 630 909