Materials markup, offcuts and waste, showroom subcontracting and domestic cash work. Here's how Making Tax Digital for Income Tax applies to flooring fitters, and exactly when it starts for you.
MTD for Income Tax phases in by gross income before expenses. Flooring passing through your invoices lifts your gross turnover, so the threshold can arrive sooner than you'd expect.
When you supply the flooring as well as fit it, the materials pass through your takings and count towards the threshold. Recording your purchases as expenses keeps your tax based on the fitting margin.
When you're in scope, your annual Self Assessment return is replaced by four short quarterly updates and a year-end final declaration, all through recognised software.
Record supply-and-fit purchases against the job so the margin is clear and offcuts are naturally in your costs.
When you supply the flooring, it's income and an expense. Record both so you're taxed on the fitting margin.
The flooring you buy is a cost whether it's laid or wasted. Recording the purchase means waste is already reflected.
Fitting for a retailer is income. If they supply materials, only your fee counts; if you supply too, the full charge does.
Supply-and-fit can push your gross over £30,000 quickly. Tidy records mean you'll know the moment you tip into scope.
When flooring makes up most of a job, the margin matters. Clear Books keeps income and purchases matched and gives HMRC exactly what MTD needs, whenever you're in scope.
Record materials and jobs as you go, watch your gross against the thresholds, and be ready to submit when your wave lands.
