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MTD for ITSA

3 Cloud Accounting Tips To Save Your Business Time And Money

3 Cloud Accounting Tips To Save Your Business Time And Money

Keeping on top of your accounts is a big part of running a successful and profitable business. But you don’t want to spend ALL your time dealing with accounting tasks, especially when that time could be spent building customer relationships, or developing new products etc.

So, how do you keep your finances in check, while also spending less time and money on your accounts?

  1. Bringing your accounting into the digital age

Switching to cloud accounting can be a revolutionary step for many business owners, especially when you look at the ways you can streamline and automate the basic accounting tasks. By using accounting platforms like Xero, QuickBooks, MYOB or Sage, you get all the basics of small business financial management, but with the benefits of smart automation.

With most modern cloud accounting software, you can:

  • Automate the scanning and digitisation of your expenses and receipts
  • Automatically reconcile your bank transactions with your invoices and bills
  • Connect your accounts to other time-saving apps for mileage claims or staff expenses.
  1. Getting paid faster and with less admin

With a cloud accounting platform driving your business, you also make it easier to send out e-invoices and get paid faster and more effectively. Improving your payment times and cash collection can make a huge difference to your cashflow position, and also sets the right expectations with your customers – making it clear that you require to be made on time.

Using the invoicing function in your business software, you can:

  • Quickly send out electronic invoices as soon as a job is completed
  • Set up automated invoices to be sent out at pre-agreed points in a project
  • Include payment buttons on your invoice, so customers can pay via PayPal or card
  • Remove the barriers to payment and speed up payment times.
  1. Getting a better overview of your important numbers

Using cloud accounting isn’t just about automating the time-consuming financial admin tasks. By recording and tracking all the financial and non-financial data flowing through your system, your accounting platform can actually provide you with a goldmine of useful real-time information.

With cloud accounting providing your reporting, you can

  • Access totally up-to-date real-time information, to improve your decision-making
  • Track your performance against targets to see how well the business is performing
  • Monitor spending and budgets to keep your cashflow under control
  • Understand your return on investment when it comes to sales and marketing activity 
  • See how promotion has driven sales but reduced your profit, due to discounting.

Talk to us about setting up a more productive kind of accounting

If you want complete control of your finances and business decision-making, updating your accounting software and processes will be key to achieving that goal.

We can help you decide which accounting software is most suited to your business, and how to maximise the benefits you get from automation and real-time data.

Get in touch to talk through updating your accounting and you can request us here fee quote.

3 Cloud Accounting Tips To Save Your Business Time And Money Read More »

Extension of Making Tax Digital for Income Tax (Individuals)

Extension of Making Tax Digital for Income Tax (Individuals)

On 19 December 2022, the government announced the extension of Making Tax Digital (MTD) for Income Tax (individuals) from April 2024 to April 2026 (except general partnerships). In this article, a brief of the changes in MTD for ITSA will be explained.

MTD for ITSA Extension

  • From April 2026, you must meet the MTD compliance if you have more than £50,000 qualifying income.
  • From April 2027, if your qualifying income is more than £30,000, you must comply with MTD requirements.

The qualifying income refers to your gross self-employment income or rental property income or both in together. Gross income means the total income before the deduction of expenses.

Example 1: You have gross income of £30,000 from self-employed and property rental income of £25,000, so the total income is £55,000. Here, you are subject to MTD for ITSA from April 2026 as having total qualifying income more than £55,000 from both self-employed and property rental.  

MTD for Jointly Owned Property:

You may have property rental income from jointly owned property and in this case, your share of the property income will count as your qualifying income rather than the total income of the jointly owned property.

Example 2: You have jointly owned property income of £50,000 (equal share to you and your partner, £25,000 each). You also don’t have any income from self-employed. Here, you are not subject to MTD for ITSA from April 2027 as having less than £30,000 income per individual.

Other matters of MTD for ITSA:

  • You may use MTD for ITSA in voluntary even if your income is less than the qualifying income.
  • Your residency and domicile status will effect on your qualifying earning. For instance, you are UK resident and domicile and having self-employed income in the UK, but property rental income from overseas. Here, your overseas property rental income will count as qualifying income along with your self-employed income here in the UK. However, if you are domiciled outside of the UK then only your UK self-employed and property rental income will count as qualifying income.
  • You may apply for exemption from MTD for ITSA if you can not use software due to your age, disability, location or other unavailable circumstances.
  • However, you can not sign up for MTD in case of you are trustee, personal representative of someone who has died, Lloyd’s member and non-resident company.

Here to Help on Your MTD for ITSA?

At The Stan Lee, we have MTD compatible software for you and pleased to support confidently. For further information and about your MTD for ITSA, please get in touch with one of the friendly team and let’s find out how we can help you.

Disclaimer: The above information is just as a general information that might help you. However, we highly recommend having expert advice suited for your circumstances. The Stan Lee and its author are not liable if you rely on this and have any consequences.

Extension of Making Tax Digital for Income Tax (Individuals) Read More »

UK Property Rental Income Tax: Seven Things to Know When You Let Property

UK Property Rental Income Tax: Seven Things to Know When You Let Property

Are you a property owner here in the UK and having property rental income? You might have questions how to manage your property income and expenses for tax purposes and whether any new rules coming that will affect you. In this article, we will mention seven key things as a guidance regarding your UK property rental income tax and might help you.

Seven Things About Property Rental Income Tax: –

 
  1. Register for Self Assessment: You should register with HMRC for your self assessment tax so that you can declare your UK property rental income. You can do the registration online or via post. Doing online registration is quicker and time consuming. Please note that the registration deadline is 05 October (for example, you should register by 05 October 2022 for tax year ending 05 April 2022).
  2. Record Keeping: You need to keep your rental income records for 5 years and 10 months after the end of the tax year. We commend to use one dedicated bank account for your property rental income and expenses and keep all invoices accordingly so that we can manage your record smoothly.
  3. Use All Available Expenses: A range of expenses are available to deduct from your property rental income that are allowable for tax purposes. Please have a look in HMRC website and speak to your tax advisors how to minimise your tax liability legitimately. Please note that any expenses that are “wholly and exclusively” for rental income purpose can be deductible.
  4. Transferring Ownership Between Spouses: If you are newly married and having property in your name only, you may transfer the property between spouses without paying Capital Gains Tax (CGT). However, the transfer might be subject to Stamp Duty Land Tax (SDLT) and you should take careful decision when doing so.
  5. Mortgage Interest and Tax Relief: Since April 2020, you are no longer eligible to deduct interest as an expense on your property rental income. Instead, you will receive tax relief at 20%. Therefore, the basic taxpayers can utilise the interest fully. Unfortunately, the higher and additional taxpayers can do so.
  6. Ready for Making Tax Digital (MTD): The MTD for ITSA is compulsory for all from 06 April 2024 for those people having annual rental income of more than £10,000. You need to update your rental income and expenses every quarter along with your annual self assessment tax return that you do currently.
  7. Submission and Payment to HMRC: 31 January is the deadline for submitting the tax return by online and pay the tax to HMRC as well on the same date. For example, the tax return for year ending 05 April 2022 should be submitted by 31 January 2023. If you submit paper-based tax return, then the submission should be by 31 October. Moreover, some taxpayers may subject to pay their tax liability on account and the deadline is 31 January and 31 July.   

As a landlord, you should comply with the tax matters on your property rental income. You may also consider some other aspects along with the above mentioned. The Stan Lee is here to help confidently on your UK property rental income tax affairs.

The above information is just as a general information that might help you. However, we highly recommend having expert advice suited for your circumstances. The Stan Lee and its author are not liable if you rely on this and have any consequences.   

UK Property Rental Income Tax: Seven Things to Know When You Let Property Read More »

Making Tax Digital (MTD) for Income Tax (Individuals)

Making Tax Digital (MTD) for Income Tax (Individuals)

Making Tax Digital (MTD) for Income Tax (Individuals)

Making Tax Digital (MTD) for Income Tax (Individuals)

As we understand that the UK tax system is going to be mostly digitalized and you may be already familiar with this if you have already VAT registered businesses. However, this blog will give a brief note about Making Tax Digital for Income Tax (individuals).

Who is subject to MTD for ITSA?
 

Are you an individual that having annual income of £10,000 as self-employed and landlord? If the answer is “Yes” then you might be subject to MTD for ITSA. Here are some examples for your clarity:

Example 1: You have income of £6,500 from self-employed and property rental income of £5,500, resulting in the total income is £12,000. Here, you are subject to MTD for ITSA as having total income more than £10,000 from both self-employed and property rental.  

Example 2: You have total rental income of £18,000 (jointly owned by you and your wife, £9,000 income each). Here, you are not subject to MTD for ITSA as having less than £10,000 income per individuals.

You may use MTD for ITSA now in voluntary. However, this is compulsory for all from 06 April 2024.

How does the MTD for ITSA work?

You may think how the MTD for ITSA works. Currently, you do your tax return once in a year and the deadline is 31 January if submitted by online. However, you should update your income and expenses on quarterly basis once you are subject to MTD for ITSA. There are four submissions in a year as follows:

Update for

Period

Deadline

Quarter : 01

01 April to 30 June

05 August

Quarter : 02

01 July to 30 September

05 November

Quarter : 03

01 October to 31 December

5 February

Quarter : 04

01 January to 31 March

05 May

You may use 5th rather than month end (for instance; 06 April to 05 July rather than 01 April 30 June). However, the submission deadline is the same.

How can we help on your MTD for ITSA affairs?
 

At The Stan Lee, we have MTD compatible software (IRIS) for you and pleased to support confidently. Please note that we will help and guide you on your MTD for ITSA affairs with reasonable and competitive fees that might be the best suited for you.

For further information and advice about the MTD for ITSA, please ring a bell with one of the friendly team here at The Stan Lee and let’s find out how we can help you.

Making Tax Digital (MTD) for Income Tax (Individuals) Read More »

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The Stan Lee has the experience and expertise available to assist you as and when required. So what makes us different when compare to our competitors? The key difference is our team of highly qualified professionals go the extra mile for their clients.

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The Stan Lee is our trading name of two separate entities as follows:
  • Stan Lee Accountancy Ltd; an ACCA Accountancy firm (Reg No: 4607747 that offers accountancy, taxation, estate administration, ATOL and other business support services that are authorised by the ACCA.
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We are required by our professional bodies to have separate entity and therefore, there are two firms involved. Both firms are required to have Professional Indemnity Insurance (details of the PII available in our office upon request).

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