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A tradesman earning less than £4,000 a year in rental income will be forced to report his tax five times a year under new HMRC rules.
Landlords, businesses and the self-employed with a turnover of at least £50,000 must now submit tax information quarterly – and an end-of-year self-assessment – after HMRC expanded its Making Tax Digital (MTD) drive on April 6.
But the new rules mean many taxpayers who no longer breach the income threshold must still comply for a further three years.
Garry Piccolo, a glass installer from Essex, switched from being a sole trader with a total income of more than £50,000 to an employee last year.
Despite only earning a small rental income of £3,680 alongside his salary as an employee, which does not need to be reported under MTD, Mr Piccolo will have to make five tax submissions each year for the next three years to comply with the rules.
The tradesman estimates that the extra tax filings could cost him £2,500 a year in accountancy fees.
Mr Piccolo said: “It’s ridiculous. The Government says it’s making things easier for the self-employed, but everything you do brings another cost. I’m 69 and I don’t want the hassle.
“It seems nonsensical that HMRC can’t look at my situation and say ‘that’s unreasonable’.”
