Second 2017 Finance Bill provides welcome news regarding MTD
You will be forgiven if the imminent introduction of making tax digital (MTD) has slipped your mind. There has been a lot going on. However, to recap, the Government had planned to require some self-employed businesses, as well as landlords, to make quarterly returns of their income and expenses to HMRC from April 2018. The original legislation introducing MTD was stripped out of the 2017 Finance Bill as the Government felt there was insufficient time to debate any controversial measures prior to the General Election. A second 2017 Finance Bill has just been announced which reintroduces MTD but with some significant changes. Simply put, the Government has listened to the concerns of the profession – including ourselves. This has resulted in the following changes:
– Businesses with turnover in excess of the VAT threshold (currently £85,000) will need to report quarterly from April 2019 but only for VAT purposes. In reality this means that such businesses need only ensure that they are meeting the digital record keeping requirements of MTD as they will already be making quarterly reports for VAT.
– Those businesses will not have to report information to HMRC quarterly in regards other taxes until 2020 at the earliest
These changes are very welcome. We will be contacting each of you that are affected to start the process of making you and your business MTD ready at the right time.
There will be further releases concerning the other deferred clauses from the initial 2017 Finance Bill shortly. CBW will, as always, keep a close eye on developments over the coming weeks and months as decisions are made by our Government, and crucially communicate what we believe these will mean for our clients and contacts.
As always, if you have any queries, please do not hesitate to speak to your usual CBW contact or click here to message one of our tax specialists.