Making Tax Digital – Election Update

In the last budget, the timetable was announced for introducing quarterly reporting (Making Tax Digital). There are still a number of unanswered questions which HMRC are consulting on. The timetable from the budget will mean that;

  • From April 2018 any sole traders, partnership businesses, or landlords with an annual turnover above the VAT threshold (currently £85k), will need to start reporting quarterly to HMRC.
  • From April 2019 any sole traders, partnership businesses, or landlords with an annual turnover below the VAT threshold (currently £85k), will need to start reporting quarterly to HMRC.
  • From April 2020 for any limited companies.

 

We have been responding to the HMRC consultations about our concerns to the changes in reporting to HMRC, and the speed at which the changes are planned to be introduced. We are particularly concerned about the lack of clarity that HMRC has given on certain issues.

The government has released some guidance on the legislation that says;

“The government is keen to ensure that stakeholders have an opportunity to comment on the draft regulations. Therefore, the government will also publish a full version of the draft regulations in the summer of 2017 for technical consultation.”

Now that an election has been called for 8 June, it may lead to a delay in the final legislation that will set out the details for making tax digital, which were intially expected in summer. It may even lead to a new government or a new chancellor.

Alternatively, Treasury Committee Chair Andrew Tyrie said that “when an election is called, large sections of the budget are excised in hurried negotiations between the [government and opposition] front benches and a concertinaed finance bill is pushed through on an agreed basis, in order to ensure that the public finances are not put at risk.”

We will be advising clients on how to prepare for quarterly reporting and updating them on any information that is necessary in helping to support them. We have been working with software providers to get the best solutions for clients and offering discounts.

 

 

 

 

 

 

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