HMRC Pushes For Digitisation Of Landlord Accounts
HMRC are keen to get landlords submitting quarterly returns by 2018, they state, "The way you interact with the tax system is changing. From 2018 it will become increasingly digital and most businesses, the self-employed and landlords will need to use software or apps to keep their business records, and to update HMRC quarterly. The underlying tax rules will be simplified to support these changes."
There is a full consultation underway - read the details here. They say, "This document provides an easier way to respond to the Making Tax Digital consultations than the full formal consultations. We have included a summary of the main issues and some specific questions, aimed at small businesses and smaller landlords. There are links to the full consultations at various points if you would like more detail. This is your opportunity to have your say - please get involved."
If you have any concerns with the proposal that your activities as a landlord need to include fully automated business systems which effectively submit data towrds your tax return every quarter, then you need to respond to this questionnaire that HMRC have created - complete it here. You can also respond in writing to:
HM Revenue and Customs
Making Tax Digital for Business consultation overview
Room 3C/12
100 Parliament Street
London
SW1A 2BQ
You have until 7th November to respond.
The PDPLA position is that exempting landlords with annual turnover below £10,000 is unrealistic and it ought to be the same as the VAT threshold or better still, double that (£166,000pa). Asking landlords smaller than this to invest in business software to handle their book keeping in place of the simple spreadsheets they use now is a significant cost and time overhead with no benefit for anyone - then asking said landlords to change their working practices such that this software is fully up to date with all business transactions so that data can be submitted on a monthly or quarterly basis will drive many out of business as the workload at busy times of the year will be too great to add this overhead to already stretched resources.
If you agree with this logic - please tell HMRC, enough people asking for the threshold to be raised before implementation could ensure this pain goes away for most of us. If it doesn't, plan to spend maybe £1,000 on landlord software plus 10% annual maintenance fees and be prepared to input all receipts and expenses at least on a weekly basis....