The new timeline indicates that it is only businesses with turnover above the VAT threshold (£85,000) that will need to keep digital records and come under MTD in 2019. Other businesses will come under the MTD in 2020.
The New Making Tax Digital Timetable
• Only businesses with a turnover above the VAT threshold (currently £85,000) will have to keep digital records from 2019 and will only have to do so for VAT purposes.
• Businesses will not be required to keep digital records, or to update HMRC quarterly, for any other taxes until at least 2020.
• Making Tax Digital will be available on a voluntary basis for the smallest businesses, and for other taxes.
The Treasury statement from Mel Stride, Financial Secretary to the Treasury and Paymaster General, said that digitalising the tax system is “the right direction of travel” but many have been worried about the practicalities, and so the government has listened to concerns and acted accordingly by delaying the Making Tax Digital timetable.
KPP welcome an end to the uncertainty surrounding Making Tax Digital.
As accountants, we welcome an end to the uncertainty surrounding Making Tax Digital.
The revised Making Tax Digital timetable has been well received by us and the delay will provide more time for the pilot to be widened, and for us and our clients to get prepared. The pilot scheme for VAT will start by the end of this year in a phased approach, until HMRC’s live pilot begins in the Spring of 2018.
We will now be looking to HMRC to take the lead in terms of letting businesses know about MTD. To date, there has been no official communication from HMRC to businesses and this is needs to happen to ensure the message gets through to the wider business community.
If you have any questions on making tax digital or any other accounting matter contact us today by telephoning 0141 345 2335.