SJCM Accountancy

SJCM Accountancy SJCM Accountancy can provide you with a full bookkeeping, accountancy and taxation service tailored to suit your requirements.

The aim of the game for us is balancing technology with humanity - get in touch to find out more! ๏ฟฝ

15/04/2026

โ€˜Can my accountant handle MTD for me?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

Yes, most accountants, bookkeepers and tax advisors will be offering an in house based solutions but do check with yours ๐Ÿ˜Š

At SJCM Accountancy we currently have two offerings available:

1. Client-led (client submits quarterly updates) with little guidance, just pointers in the right direction and we then complete the MTD tax return and prepare the annual accounts as we usually would

Or

2. Practice-led (we submit the quarterly updates) and we submit the MTD tax return and prepare the year end accounts as we usually would.

Some advisors will be offering a middle ground whereby the client does most of the bookkeeping but asks the advisor to finish / submit ๐Ÿ˜Š

Check with your advisor if they havenโ€™t already made contact and if in doubt, we are always happy to help ๐Ÿ™Œ

14/04/2026

โ€˜Cash or accruals basis for MTD?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

The cash basis, meaning when money is received or spent, rather than invoice dates, is the default for MTD but the accruals basis can be selected if preferred ๐Ÿค”

Whichever method is chosen, it must be consistent, tax payers cannot switch form one method to the other ๐Ÿ™‚โ€โ†”๏ธ

Ask your advisor for help with this if you are unsure ๐Ÿ˜Š

13/04/2026

โ€˜How do landlords account for joint income on their MTD submissions?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

Well the good news is there is a specific easement for joint landlords ~ watch to find out more ๐Ÿ˜œ

And remember itโ€™s only YOUR share of the rental income which you need to declare on your MTD returns ๐Ÿ˜Š

11/04/2026

โ€˜Can HMRC open enquiries into a quarterly submission?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

Quarterly updates do not give HMRC new enquiry powers, as they can not use this as evidence in its own right, however, HMRC can request access to the quarterly returns to refer back to in terms of an investigation on your tax return submission ๐Ÿ™Œ

11/04/2026

โ€˜What if I am enrolled to MTD in 2026/27 but no longer meet the requirements or my income falls below the threshold?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

Unless you have disposed of your property or ceased trading therefore existing conditions, there is a three-year rule. The three-year rule states that the taxpayer must be below the total qualifying income requirements for 3 tax years before being able to exit MTD ๐Ÿ™Œ

09/04/2026

โ€˜What if I make a mistake in an MTD quarterly update?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

You can correct it in a later submission or during the final declaration ๐Ÿ™Œ

You do not need to submit an amendment for the mistake ๐Ÿ’ญ

Quarterly updates will be cumulative, so if an error is discovered in a previous submission, it can be corrected the following quarter ๐Ÿ™Œ

You will also need to correct the underlying digital records โ˜‘๏ธ

09/04/2026

โ€˜Are there penalties in MTD?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

There is a new points-based late filing penalty system for MTD. This, along with the new late payment penalty rules both apply from the tax year in which you are required to join MTD. Under the points-based system, no financial penalty arises for the first late submission ๐Ÿค”

Late payment penalties are also changing for taxpayers within MTD ๐Ÿค”

This is the same kind of system we have for VAT late submission and payments although the two taxes will not be linked in relation to accumulated points ๐Ÿ‘Œ

You will receive a penalty point each time you miss a submission deadline for the MTD tax return and from 2027โ€“28 onwards, you will also receive a penalty point for each missed quarterly update, if you are legally required to comply with MTD ๐Ÿ’ญ

Points accumulate until a threshold is reached, at which point a ยฃ200 penalty is issued. Once the threshold has been reached, any further late submissions will result in an immediate ยฃ200 penalty ๐Ÿ’ญ

This position can only be reset once certain conditions are met. This system can be hard to get your head around but there is clear guidance available on HMRCโ€™s website ๐Ÿ˜‰

06/04/2026

Are there exemptions for MTD? ๐Ÿ™‹โ€โ™€๏ธ

Yes, exemptions exist, these automatically apply to:

Ministers of religion, Lloydโ€™s under writers and tax payers in receipt of Married Couplesโ€™ Allowance or Blind Personsโ€™ Allowance who arenโ€™t required to join MTD until after the current parliamentary term.

**Note that this is not marriage allowance โ€“ most of the married couples allowance claimants will now have passed away as one spouse must have been born pre 1935.

Individuals with only foster care income will be exempt, along with anyone who doesnโ€™t have a national insurance number in the relevant year ๐Ÿ™Œ

Some exclusions are automatic; others require an application to HMRC. According to HMRC, โ€œdigital exclusionโ€ means it is not reasonable or practical for you to use MTD-compatible software ๐Ÿค”

Tax payers will need to apply for this exemption and it does not automatically carry over from VAT exemptions from MTD.

Religious reasons can provide a reason for exemption If youโ€™re a practising member of a religious society whose beliefs prevent you from using electronic communications or digital record-keeping โ˜‘๏ธ

For practical difficulty this would be things like having a physical or mental condition which makes digital tools difficult or impossible to use, living in a remote location with no reliable internet or mobile access or your age or digital literacy making it genuinely unreasonable for you to maintain digital records, even with help ๐Ÿ’ญ

You can apply for exclusion in writing to HMRC or ask an authorised advisor to do this for you ๐Ÿ˜Š

06/04/2026

โ€˜How should I keep documents of my records?โ€™ ๐Ÿ™‹โ€โ™€๏ธ

Under MTD for income tax you MUST keep digital records of all transactions, that being: date, amount and category ๐Ÿ™Œ

You may choose to scan and upload purchase invoices and receipts to your chosen software or you may continue to keep paper copies ๐Ÿคทโ€โ™€๏ธ

Scanning / taking photos of receipts isnโ€™t mandatory, but it is good practice and we find busy business owners often never look back once they have tried a life without paper receipts laying around all over the house / car and office ๐Ÿงพ

03/04/2026

What is bridging software? ๐Ÿ™‹โ€โ™€๏ธ

Honestly ~ itโ€™s not for me ๐Ÿคฃ

But Iโ€™ve given my best attempt at an explanation ๐Ÿคทโ€โ™€๏ธ

Per HMRC:

Software that connects to your records:

This type of software will connect to existing records kept in spreadsheets or other accounting tools.

It is sometimes referred to as โ€˜bridging softwareโ€™.

For example, if you use spreadsheets to record income and expenses, bridging software can connect to them and make your submissions to HMRC.

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Hebden Bridge

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