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  • Tax

    Landlords to file up to 5 tax returns a year

    Self employed people, small businesses, and landlords are up in arms about the new digital tax system.

    Pilots for the project – called “making tax digital” – begin within days.

    Millions of people will then be drawn into the system from April next year, with the result that some will be making as many as nine VAT and tax returns per tax year in addition to meeting six payment deadlines.

    The Government insists the cost to individuals will be low and that the process will assist in orderly record-keeping. It says errors made by the self-employed and small business mean billions of pounds in tax go uncollected.

    But small businesses, landlords and self-employed individuals, along with swathes of the accountancy profession – even though they arguably stand to benefit – have attacked the plans as “absurdly burdensome” and “damaging to business and growth”.

    How will the reporting work in practice?

    Assume your business has a year end of April 5. That means you’re into the new system from the beginning of the tax year 2018‑19. Below is a calendar of tax events for that first year. If you pay VAT, there will be four additional return dates not shown below.

    July 5 2018: your first quarter (2018-19) ends

    July 31 2018: your second payment for the 2017-18 tax year is due

    August 5 2018: your first quarterly return (2018-19) is due

    October 5 2018: your second quarter (2018-19) ends

    November 5 2018: your second quarterly return (2018-19) is due

    January 5 2019: your third quarter (2018-19) ends

    January 31 2019: your return and outstanding payments for the 2017-18 tax year are due

    January 31 2019: your first payment for the 2018-19 year is due

    February 5 2019: your third quarterly return (2018-19) is due

    April 5 2019: your fourth quarter (2018-19) ends

    April 6 2019: the 2019-20 tax year begins, setting off the next four returns for that year

    May 5 2019: your fourth quarterly return (2018-19) is due

    July 31 2019: your second payment for the 2018-19 tax year is due

    January 31 2020: the fifth, “finalising” return for 2018-19 is due, along with final payment.

    Full/source story 

    RLA vice-chair and director for Wales Douglas Haig has appeared before a House of Lords committee answering questions on the impact of the Government’s Making Tax Digital plans.

    Douglas appeared before the House of Lords Economic Affairs Sub-Committee, which was looking at the Draft Finance Bill for 2017, earlier today.

    He told the committee that digital tax plans would be easier to adopt for those with larger portfolios but that there were fewer benefits for smaller landlords or those with single properties.

    He also spoke out against plans to introduce the new system at the same time as controversial changes to Mortgage Interest Relief, which will see landlords taxed on turnover rather than profit.

    Full/source article

    So along with Section 24, the stamp duty surcharge, the PRA, energy efficiency, increasing legislation, increasing fines, Right to Rent, Universal Credit ... etc. etc., landlords have yet another burden to deal with!

    All this will surely deter new landlords from entering the market and existing landlords may feel like exiting as it's all getting too much as the margins are being decimated.

    SEE ALSO  -         The biggest threat to landlords is ...

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    I must say I don't have an issue with the above

    I run my business with professional Landlords Software so im quite sure the maker would find a way of doing returns

    Good record keeping is important if you do it now it should not cause an issue


    Learn Change and Adapt ?????

    Very much right Vanessa. It's important to have a good record keeping. There are various Landlord softwares around to assist in such cases.


    I don't have an objection to digital tx as such, but the frequency should depend on the size of the business.

    Also from https://www.gov.uk/government/publicatio...ax-digital

    At Spring Budget 2017 the government announced that it would provide 3.1 million small businesses with an extra year (until 2019) before they are required to keep digital records and send HMRC quarterly updates. You can read more detailed information about this announcement in this tax information and impact note.

    Later it says:

    Following the feedback from the Making Tax Digital consultations, the government announced at Budget 2017 that it will provide 3.1 million small businesses and landlords and their agents with an extra year to prepare before they are required to keep digital records and send HMRC quarterly updates. Businesses that have an annual turnover below the VAT registration threshold will not be required to start keeping digital records and providing quarterly updates until April 2019, although they can choose to do so voluntarily.

    Also on that page

    digital record keeping software will be linked directly to HMRC systems, allowing customers to send and receive information directly from their software.

    I doubr they mean Excel though, which all I currently use.


    Since many Universal Credit recipients (on variable earnings) are having to/will have to update DWP on their earnings monthly, requiring businesses to do so 5 times a year is hardly onerous. 

    The whinging sounds similar to what came out when PAYE was introduced 1944(?) - as it happened my uncle was involved in that change...

    £5 says HMRC's software assume you have Windoze or Apple (but not Linux.. which powers most of the InterNet...) Anyone know??


    I'm hoping that someone will bring out software at a fair price to cover this, I bet I spend at least an hour a day on my spread sheets already. It's not just landlords but all SME's (Small Meduim Enterprises) that will be adversly affected who all think they are conservatives no doubt??

    If I was 30 years younger I would go to Australia to be honest. Nice hospitals, nice doctors with no waiting lists, free to use electric BBQ's in the parks etc, etc. Rant over, have a nice day!


    a-ha!  But - public hospitals have waiting lists, private ones can only be accessed if you have private health insurance ($400 or £240 per month for my husband and I), the nice doctors visit will cost you a minimum of $32 co-payment for each visit whether or not your have private insurance, and for the very nice doctors you can wait a week to get an appointment.  The free barbies are good though!

    Big Grin


    Can those of you that are using software please let us know what you're using, and approximate monthly cost? I'm wondering how much of this I will have to do before passing it on to my accountant and how often they will have to be involved when this comes in?

    Note to oneself: become an accountant in my next life!


    Looking at who is supposed to be affected on .gov it says

    Businesses, self-employed people and landlords will be required to start using the new digital service from:

    • April 2018 if they have profits chargeable to Income Tax and pay Class 4 National Insurance contributions (NICs) and their turnovers are in excess of the VAT threshold
    • April 2019 if they have profits chargeable to Income Tax and pay Class 4 NICs and their turnovers are below the VAT threshold
    • April 2019 if they are registered for and pay VAT
    • from April 2020 if they pay Corporation Tax (CT)

    Businesses, self-employed people and landlords with turnovers under £10,000 are exempt from these requirements.

    I have a turnover of over £10k though my company currently doesn't. I don't exceed any the VAT thresholds,  I don't pay NICs. I am not registered for VAT. I don't pay Corporation Tax, though, hopefully my company will be paying by 2020.

    So it looks like I won't be affected personnally, but my company will be.

    It looks like landlords whose only income is from residential letting of properties in their own name will not be affected whatever their turnover (since residential lettings are VAT exempt and so don't count towards VAT thresholds).

    It depends on the detail of the law though, and they will probably extend it further.


    Good news!

    Plans to force millions of businesses and self-employed people to file multiple tax returns each year have been shelved by the Government.

    The policy, known as "Making Tax Digital" has been dropped from today's Finance Bill, which will be the last to be debated in the Commons before Parliament adjourns for the General Election.

    Experts said the decision meant the scheme, which was due to hit large businesses from 2018 and small businesses from 2019 will be delayed by at least a year. It also raises the possibility that it could be scrapped altogether. 

    Full/source story


    "The Government insists the cost to individuals will be low and that the process will assist in orderly record-keeping. It says errors made by the self-employed and small business mean billions of pounds in tax go uncollected."

    So why drop it? - maybe because it was a stupid idea in the first place. Why not do daily tax returns...hourly? That will make sure all tax is paid.

    We have idiots running this country and the upcoming election isn't going to change that.



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