We hope you enjoyed our first webinar! We were thrilled to have so many of you log in, and submit questions - In fact so many questions were submitted that we haven't been able to squeeze our answers into just one post! Instead we will release a series of posts, dedicated to answering your questions, starting with all MTD related questions! 

*Some questions have been edited for clarity 

Questions relating to Making Tax Digital

This is the question we get asked the most at APARI - so much so that we have written an entire blog about it. Read more about Making Tax Digital for Income Tax here! 

 

When does Making Tax Digital for Income Tax become mandatory?

For self employed businesses and landlords, MTD for Income Tax becomes mandatory for the first accounting period starting on or after the 6th April 2026.

How task intensive is Making Tax Digital for Income Tax?

This will vary for each individual. If you are already keeping good records in a digital format, the transition to MTD with APARI should be straightforward. We know that getting used to any new software or app can take time, which is why APARI has invested so much to make our product as intuitive and simple as possible. Find out how to best prepare for MTD here.

Is there a minimum income requirement to join MTD?

You will be required to join Making Tax Digital for Income Tax if your combined annual property and self employment income is over £50,000. That is based on turnover not profit.

Why is the MTD threshold £10,000 rather than the personal allowance amount?

Although we can't assume to know all of HMRC's reasoning, we can give some speculation surrounding this - there is an estimated £90billion per year lost in incorrect filing of various tax returns - including VAT, Corporation Tax and Self Assessment. MTD is a way of reducing this figure, by reducing the ability to make errors. By having the threshold at £50,000, the margin for error leading up to the individual incurring a tax liability is reduced.

How does MTD relate to the current tax return?

There are a number of differences between MTD and the current self assessment tax return, but when it comes to the annual summary, you will find that there are a number of similarities. Read our article relating MTD to the current tax return here. 

Does MTD apply to non-UK Citizens?

Yes, the MTD rules also apply to non-UK citizens.

How do I become MTD compliant?

You can find all the information for becoming MTD compliant here.

How do I sign up to the MTD Pilot?

There is a chance that you may already be eligible to join the MTD pilot - if this is the case, then you can sign up via the HMRC website - if you are not yet eligible, you may be eligible to join the APARI pilot.

Can I operate under cash basis and accruals basis with Making Tax Digital?

HMRC currently only operate MTD on a cash basis - however they are working on developing the functionality for accrual basis, and we are working on updating the APARI software in line with this.

Does APARI do VAT Returns?

APARI is a personal tax software, specialising in Making Tax Digital for Income Tax, rather than MTD for VAT.

Has MTD implementation timetable been delayed because of COVID?

COVID has affected a number of huge events in the last year - the Olympics, the Euros, even Glastonbury have all been pushed back - but this is not the case with Making Tax Digital for income tax! MTD will officially be mandated from April 2026!

When will I be able to use MTD if you have other sources of income?

HMRC are continuously rolling out new eligibility criteria for MTD, and it is hoped that income from other sources, such as pensions and employment, will be eligible from April this year - Join the APARI community to be the first in the know!

I'm concerned MTD is required provide daily info. I wouldn't want to upload transactions more than once a week.

The requirement for MTD means that you must upload transactions along with their date, amount and category - but this does not have to be don't on the day that the transaction incurred - as long as you meet your quarterly obligation, you can upload transactions as frequently or infrequently as you like!

 

You can find everything else you need to know about MTD on our Ultimate Guide to Making Tax Digital