Making Tax Digital is the UK Government’s initiative to “make it easier for individuals and businesses to get their tax right and keep on top of their affairs.”
The goal is to make the UK’s tax infrastructure as digital as possible. It is hoped that this will make HMRC’s tax system more efficient, effective and easier to use and navigate for businesses.
Making Tax Digital entails swapping your accounts and tax from paper records to online, digital records. The idea is for as many businesses and sole traders as possible to go completely paperless with their accounts and tax.
Making Tax Digital is split into the following phases:
- Making Tax Digital for VAT (April 2022)
- Public Testing of Making Tax Digital for Income Tax (April 2025)
- Making Tax Digital for Income Tax Goes Live (April 2026) Over £50k in earnings.
- Making Tax Digital for Income Tax Self-Assessment (April 2027) Over £30k in earnings.
- Making Tax Digital for Corporation Tax – To be confirmed.
So, how will Making Tax Digital affect dentists?
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Making Tax Digital for Dentists
The first phase of MTD was introduced in April 2019 in Making Tax Digital for VAT, which regulated business with a taxable turnover over £85,000.
On 6th April 2026 Self Assessment tax payers will also need to abide by the Making Tax Digital for Income Tax regulations.
These new regulations in 2026 will only apply to Self Assessment taxpayers who file a taxable income above £50,000 a year. As an Associate dentist, you almost certainly will.
Click here to listen to our podcasts on how dentists can reduce their tax bill.
From 6th April 2026, you will have to use digital software to hold and process digital records of your accounts and tax. Paper records of your accounts and tax will no longer be allowed by law. A public testing of this commences from April 2025.
The software you use to hold and process your digital records must be Making Tax Digital compliant.
You can find a list of compliant software on the .gov.uk website here.
Your Self Assessment tax return will also change. You will instead be required to submit 5 reports throughout the year. These are, 4 quarterly summaries of your accounts, as well as an end-of-year report.
The dates you will be required to submit these returns are:
- 5th August
- 5th November
- 5th February
- 5th May
The end of year return must be filed by 31st January after each relevant tax year. Your tax bill will also need to be paid by 31st January following the relevant year, but you will be able to make tax payments throughout the year if you wish.
You can find out more about accounts and tax for dental associates here.
Making Tax Digital for Dental Practices
Currently MTD will apply to practices that trade as sole traders and earn over £50k from April 2026. Again we are recommending our clients enter the public trial and we will be implementing this with our client base.
For those practices that trade as companies, we are still awaiting a date when MTD applies for corporation tax.
You can sign up to the scheme early voluntarily, no matter your taxable turnover. This may be worth doing, in only to give yourself more time to get used to the new process.
Click here to watch our webinar on using Xero and Hubdoc for your dental practice accounts.
It is also required that your practice uses digital accounting software that is compliant with Making Tax Digital, such as Xero. You will need to keep your digital records for 6 years.
You can find a list of compliant software on the .gov.uk website here.
Here is a list of example records you will need to keep from the UK Government website:
- your business name, address and VAT registration number
- any VAT accounting schemes you use
- the VAT on goods and services you supply, for example everything you sell, lease, transfer or hire out (supplies made)
- the VAT on goods and services you receive, for example everything you buy, lease, rent or hire (supplies received)
- any adjustments you make to a return
- the ‘time of supply’ and ‘value of supply’ (value excluding VAT) for everything you buy and sell
- the rate of VAT charged on goods and services you supply
- reverse charge transactions – where you record the VAT on both the sale price and the purchase price of goods and services you buy
- your total daily gross takings if you use a retail scheme
- items you can reclaim VAT on if you use the Flat Rate Scheme
- your total sales, and the VAT on those sales, if you trade in gold and use the Gold Accounting Scheme
You can find out more about accounts and tax for dental practices here.
Making Tax Digital With Samera
At Samera we no longer be accept paper records for our accountancy clients. All accountancy and tax records need to be in digital format.
We only use software that is compliant with the Making Tax Digital scheme. We are a Xero Gold Partner and have been pioneering digital accountancy for dentists for years.
When you go digital with our dental accountants, your accounts and tax are received, processed and stored safely, securely and easily.
All you need to do is scan your receipts and invoices, upload them to Hubdoc and we will do the rest!
The process is quick, simple and safe – which means you save time, effort and money.
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Dental Accounts & Tax Specialists
As dental practice owners ourselves, we know what makes a clinic tick. We have been working with dentists for over 20 years to help manage their accounts and tax.
Whether you’re a dental associate, run your own practice or own a dental group and are looking to save time, money and effort on your accounts and tax then we want to hear from you. Our digital platform takes the hassle and the paperwork out of accounts.
To find out more about how you can save time, money and effort on your accounts and tax when you automate your finances with Samera, book a free consultation with one of our accounting team today.
Dental Accounts & Tax: Further Information
For more articles, webinars and blogs on dental accounts check out the dental accountancy section of our Learning Centre and follow us on YouTube, Facebook and Instagram.
