HMRC announced significant changes to the Making Tax Digital timescale

Digital Pause: The government have recently announced a delayed start date for their proposed Making Tax Digital (MTD) programme which was set to be introduced from April 2018.

The new timescale is a welcome change from HMRC, who have responded to concerns raised by accountants and businesses about the lack of detail provided by HMRC and the short timescales.

New timescale

VAT registered businesses will be required to maintain digital records and will make their quarterly VAT submissions under the new MTD system from April 2019.

Self-employed individuals, landlords and partnerships with turnover above the VAT threshold (currently £85,000) will be required to make quarterly submissions for income tax from April 2020 at the earliest.

The anticipated timescale for companies has not changed and all corporates will be making quarterly submissions from April 2020.

Smallest businesses

HMRC have also confirmed that quarterly reporting and digital record keeping will not be mandatory for the self-employed and landlords with turnover below the VAT threshold.  However they will be able to make voluntary submissions if they wish.  

Next steps

Although the start date for MTD has been delayed, the move to a digital tax system is inevitable.  It is still worthwhile reviewing your current accounting methods sooner rather than later to ensure that you will be digital ready. There are a number of options available depending on the size and nature of your business.

To find out more about the services that we offer, visit our Private Clients page. Alternatively, if you would like further information on the issues raised above, please contact us using our contact page.

Comment

Mary Shoesmith

Director, Private Clients
​I am a member of the ATT, CTA and STEP. I have had a varied career dipping out of practice for a while to spend some time teaching ATT and CTA and also the tax elements of the main accountancy qualifications.