Making Tax Digital (MTD) for Income Tax will be delayed until April 2024, the Government has confirmed.
It means self-employed business owners and landlords will have one more year to prepare for the digitalisation of Self Assessment.
According to HM Revenue & Customs (HMRC), the decision to delay the digital tax regime comes after concerns that small business owners are still dealing with the impact of the coronavirus pandemic.
A later start date, the tax office said, will give those required to join – such as businesses and landlords with a business income over £10,000 per annum – “more time to prepare”.
Partnerships, meanwhile, will not be required to join the regime until April 2025.
MTD for VAT was first launched in April 2019, significantly changing the way businesses are required to account for VAT. This includes using MTD-compliant cloud accounting software – such as Xero or QuickBooks – to keep VAT records and submit VAT returns digitally.
Commenting on the changes, Lucy Frazer, Financial Secretary to the Treasury, said: “The digital tax system we are building will be more efficient, make it easier for customers to get tax right, and bring wider benefits in increased productivity.
“But we recognise that, as we emerge from the pandemic, it’s critical that everyone has enough time to prepare for the change, which is why we’re giving people an extra year to do so.
“We remain firmly committed to Making Tax Digital and building a tax system fit for the 21st century.”
From April 2022, almost all VAT-registered businesses will be required to use MTD for VAT to complete VAT returns, regardless of income. Under current regulations, only businesses whose turnover exceeds the VAT threshold (£85,000) are required to join.
For help and advice with related matters, please get in touch with our team today.
“Richard Anthony case study – Terry Lewis – Jaques Samuel Pianos Widely considered to be London’s leading piano retailer, Jaques Samuel Pianos has grown considerably from its humble beginnings in the front room of Mr Samuel’s home in Notting Hill. They are now internationally recognised and have provided pianos for high-profile clients like Queen and […]”
Terry Lewis – Jaques Samuel Pianos
“Richard Anthony: ‘a super-star firm’ MT Finance is a property finance lender, specialising in bridging loans and auction finance. They assist numerous property professionals, business owners, and individuals with their finance requirements and specialise in short-term asset-based lending. Founder and Director, Tomer Aboody, knew that as an asset-based lender, the business would require an expert […]”
Tomer Aboody – MT Finance
“A family fairground success story The Botton family have been running a traditional fairground, arcade and amusement park in the heart of Skegness since taking over the Pleasure Beach in 1965. Jim, the Director of the company, took over from his father and now heads day-to-day activities and administration. He said: “The Pleasure Beach is […]”
Jim Botton – Pleasure Beach (Skegness)