Making Tax Digital

Posted on July 17th, 2017

Making tax digital was announced by Chancellor Osbourne in the 2015 Autumn Statement with the aim to digitise the tax system for the self employed and small businesses (including landlords).

The snap election delayed MTD’s implementation and enabled further consultation on the controversial plans.

The new Financial Secretary to the Treasury, Mel Stride MP announced changes to MTD on 13th July.

These changes are:

• Businesses will not be mandated to use the MTD system until April 2019 and then only to meet VAT obligations.
• This will apply to businesses with turnover above the VAT threshold (£85,000).
• Businesses with turnover below the VAT threshold will not be required to use the system, but can choose to do so.
• The system will not be widened beyond the VAT threshold before the system has been shown to work well, and not before April 2020 at the earliest.

This will ensure that there is time to test the system fully and for digital record keeping to become more widespread.