HMRC today made an announcement regarding the timing of Making Tax Digital. The plan in making tax reportable quarterly for some, had already been delayed to April 2018. However in a statement today, HMRC announced a further delay to Making Tax Digital to as late as 2019.
The announcement has been welcomed by financial institutions, professional bodies and various professions who felt that the new legislation was not properly announced, explained nor timed well enough in advance.
The key changes and dates for business owners to be aware of are as follows:
Only businesses with a turnover above the VAT threshold will have to keep digital records and only for VAT purposes. They will only need to do so from 2019.
Businesses will not be asked to keep digital records or update HMRC quarterly for other taxes until at least 2020, instead of 2018 as originally proposed.
Small businesses will be able to file digitally on a voluntary basis for other taxes
Whilst the delay has been welcomed by most quarters, it will remain important for businesses to start making their accounts digitals to ensure a smooth transition when the new legislation does come in.