Making Tax Digital (MTD) will fundamentally change the administration of the UK tax system. On 13 July 2017 the government announced a new timetable and changes to the implementation, which mean that MTD will not take effect until April 2019 and will only be mandatory at that time for businesses over the VAT threshold.
Making Tax Digital is a government initiative that sets out a bold vision for a digital tax system to ‘make it easier for individuals and businesses to get tax right and keep on top of their affairs – meaning the end of the tax return for millions’. The aim of the initiative is to make tax administration more effective, more efficient and easier for taxpayers, through the implementation of a fully digital tax system.
What’s changing?
The current plans, in brief, are:
- The smallest businesses will be exempt from MTD – the “smallest businesses” will be businesses with annual turnover of less than £10,000.
- Taxpayers will send in summaries of their income and expenditure at least four times a year.
- More taxpayers will be able to use the cash basis of accounting.
- Businesses to use only Accountancy Software to control their records
For more details on this upcoming change speak to our Tax Experts.
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