Making Tax Digital, Free and Open
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This is a new place for discussing the UK government's Making Tax Digital (MTD) initiative. In particular how we as a community can continue to file our taxes freely in terms of both:
- Avoiding high fees and vendor lock-in to commercial software
- Maintaining user freedoms with free and open source software
We are starting some 'wiki' posts that will answer the main questions and be continually updated from your comments:
Disclaimer: we are not experts and cannot guarantee accuracy here. Always seek your own financial advice.
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Welcome! The idea for this community came from a Mastodon post:
https://floss.social/@IanTwenty/114868391122043853
...and the forthcoming changes to how UK individuals and business will have to file their taxes, i.e. Making Tax Digital (MTD).
For some these changes may mean they are compelled to subscribe to a commercial software package and/or change their ways of working considerably. For some small businesses the cost of accounting software and services may be their largest expense.
My fear is that the MTD changes mean there can never be a free and open source alternative to managing personal and business finances in the UK. I hope I'm wrong.
Through this community it would be great to share and discuss:
- The changes that are coming in the UK government's Making Tax Digital initiative, both for individuals and businesses.
- How to keep filing taxes without having to subscribe to expensive accounting software.
- How to maintain our freedom when filing and paying taxes - freedom over what software you run and what it does with your personal/company data.
- I am very interested in the possibility of starting a free/open source project that could be compliant with the MTD requirements that we all might use - OR discovering and supporting such a project if it already exists.
- Lessons from other countries that have been/are going through a similar transition. I understand parts of MTD may be addressing an EU-wide effort to address fraud.
Please check out our sidebar which will be updated with important posts and links.
We are hosted on feddit.uk, a UK-centric Lemmy instance so thanks to them for having us. They have a code of conduct, please abide by that (see What are the rules here? in their homepage sidebar).
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Note: this post is intended as a community wiki that will be continually updated from your comments and any new information as it arises.
Disclaimer: always seek your own advice on financial matters. We can't guarantee accuracy!
There are two groups affected by the Making Tax Digital (MTD) initiative:
1. Individuals
If you work for yourself as a sole trader or earn money from property you are likely affected. There are thresholds to be met (on gross annual income) but they may change in future. There are some narrow exemptions including some based on age, disability and broadband access.
The current roll-out dates and thresholds are:
- 6 April 2026 if your turnover is above £50,000
- 6 April 2027 if your turnover is above £30,000
- 6 April 2028 if your turnover is above £20,000
The government refer to this as "Making Tax Digital for Income Tax" and you can read more here: Making Tax Digital for Income Tax - HMRC guide.
2. Businesses
If you are registered for VAT you should already by complying with MTD as the deadlines have passed. You can voluntarily register for VAT but if your annual taxable turnover is over £90k it's mandatory: when to register for VAT - GOV.UK.
Companies that pay corporation tax will also eventually join MTD too (see timescale for implementation - wikipedia.org). I don't think we have a firm deadline on that yet but if anyone has firm info let me know in a comment!
The wise wiki owl is from source, copyright K.-M. Hansche - Edited by: Arad, CC BY-SA 2.5 https://creativecommons.org/licenses/by-sa/2.5, via Wikimedia Commons
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