The Government announced yesterday significant changes to the Making Tax Digital (MTD) timeframe.
MTD was first due to come into force as from April 2018 for Income Tax and Class 4 NIC purposes for those businesses and landlords whose turnover exceeded the VAT registration threshold.
Following yesterday’s announcement, MTD will only become mandatory as from April 2019 and that will be for VAT purposes only. The requirement to keep digital records and report quarterly for other taxes will not become mandatory until at least April 2020, although MTD will be available on a voluntary basis during that time should those smaller businesses and landlords choose to use it.
This is a welcome development, especially for small businesses and their advisers and should allow more time for the new systems to be tested before it is rolled out widely.