Reporting income, stream by stream
We’ve teamed up with Mazuma, our accountancy partner, to make Making Tax Digital easier to understand. This article is general information only, so please speak to a qualified accountant if you need advice about your own tax position.
This is the part that surprises people most, so it is worth slowing down on. Under Making Tax Digital, HMRC treats each of your businesses separately, and each one gets its own set of quarterly updates. Your self-employment and your property are two different businesses in HMRC's eyes.
The example to remember
A self-employed plumber who also rents out a flat has two businesses. That means four quarterly updates for the plumbing and four for the property, so eight quarterly updates a year, followed by a single Final Declaration that brings everything together.
How the streams split
- Each trade is separate. If you run two different self-employed businesses, each one is reported on its own.
- All your UK property is one business. Several UK rental properties still count as a single UK property business, so four updates, though you keep the records for each property separately.
- Property abroad is separate again. Overseas property is treated as its own business, apart from your UK property.
- Jointly owned property. If you own a property with someone else, you each report your own share, and your share is what counts towards your own threshold.
A note for tradespeople on CIS
If you work under the Construction Industry Scheme for several contractors, that is still one trade, not one per contractor. You do not split it into separate businesses. CIS is simply about how tax is taken off at source, so all that work sits inside a single set of quarterly updates.
What goes in the updates, and what waits for year-end
Only your self-employment and property income go into the quarterly updates. Everything else, such as a PAYE wage, a pension, dividends or savings interest, stays out of the quarterly cycle and is added once a year in the Final Declaration.
The reassuring bit on penalties
Even with several businesses, you only ever pick up one penalty point per quarter for a late update, not one per business. So a missed deadline does not multiply against you.
If you can already feel this getting fiddly, you are not alone. Juggling several streams, several sets of records and eight or more deadlines a year is exactly the sort of thing worth handing
Public and Employers’ Liability Insurance Explained
Key differences between the two:
Covers injury or damage to the public.
Covers injury or illness to employees.
Not legally required.
Legally required with staff.
Common for customer-facing businesses.
Required for any business with staff.