HOW DOES MAKING TAX DIGITAL AFFECT SELF-EMPLOYED SOLE TRADERS IN THE BEAUTY INDUSTRY?
If you are a Limited Company or VAT registered, you will already be familiar with Making Tax Digital. However, if you are a self-employed Sole Trader working in the Beauty Industry as a Beauty Therapist, Lash & Brow Artist, PMU Artist or Microblading Artist with an annual income of over £10,000 you will soon need to start preparing for Making Tax Digital, which will come into place in April 2024.
From 6th April 2024, all self-employed businesses and landlords with an annual business or property income above £10,000 will need to follow the rules for Making Tax Digital for Income Tax. HMRC will require that a return is submitted quarterly, and that businesses will need to use Making Tax Digital compatible software to keep digital records.
We spoke to Isabella Callaghan, Managing Director of Number Crunchers (Sheffield) Ltd that specialises in providing accountancy services to SME’s (small to medium sized businesses) who discusses how Sole Traders in the Beauty industry can prepare for Making Tax Digital:
“If you are a Sole Trader with an income above £10k, the HMRC will require that you submit a return every quarter, as the name suggests (Making Tax Digital) this means digitally and to do that you will need MTD (Making Tax Digital) compatible software to keep the digital records.
It doesn’t need to be daunting if you start preparing now. We have already transitioned many clients to MTD (Making Tax Digital) compatible software, and the majority now prefer the move to digital bookkeeping. I am not going to pretend that it wasn’t different for them at first, but we have had the time to train them at no additional cost and they are now up and running and just can’t believe how much time they are saving.
There are various MTD (Making Tax Digital) compatible software packages available that you can use, such as Sage, Xero, FreeAgent and QuickBooks to name a few. Please undertake your research, as some are more affordable than others. Your accountant can also advise you on the most cost-effective option to suit your business needs.
April 2024 seems a long way away, but it is only 18 months away and if you move now to digital bookkeeping, you have time to sort any niggles and training out. This will most definitely not be the case in 18 months’ time.
In conclusion, don’t wait until 2024 - talk to your accountant today! Digital Software – will improve the way you do business by saving you time and making you look professional to your customers.”
For more information visit: https://www.number-crunchers.co.uk/
Article by: Faye Hone