HMRC believe that Making Tax Digital for VAT will make it easier for businesses to manage their tax and will save them, and their agents, time which can instead be devoted to maximising business opportunities, encouraging growth and fostering good financial planning. From 1 April 2019 approximately 1 million businesses registered for VAT with a taxable turnover above £85,000 will need to keep their VAT records digitally and file their returns using Making Tax Digital-compatible software. The recently launched pilot opened for businesses whose affairs are up to date and straightforward, and will extend to most other business types in the coming months. HMRC has delayed joining for a further 6 months for a small group of customers who have more complex requirements. The delay will allow more time for testing the service with them in the pilot before they are required to join. “HMRC is transforming the tax administration so that it’s more effective, more efficient and easier for taxpayers. Today’s announcement means that around half a million businesses will be able to join Making Tax Digital and start filing their VAT returns online, making it easier to get their tax right first time. More and more businesses use digital tools every day to help them operate – tax shouldn’t be different. This is a major step towards bringing VAT into the 21st century.” “Millions of people are already banking, paying bills and interacting with their suppliers and customers online. Using digital tools to help businesses manage their business income and expenses and get their tax right builds on this momentum and will also help them get more control over their finances. Eligible businesses and agents shouldn’t leave preparations to the last minute and are encouraged to join the pilot as soon as they can. Read more information on Making Tax Digital .” Mel Stride MP, Financial Secretary to the Treasury, said: Theresa Middleton, Director for Making Tax Digital for Business, said:
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Making Tax Digital for Business - stakeholder communications pack 11 January 2019
HMRC has updated their communications pack which has important information to support businesses that need to make the transition to digital VAT business record keeping and submission of VAT returns using MTD-compatible software from 1 April 2019. The vast majority of VAT-registered businesses with a taxable turnover above the VAT threshold (currently £85,000) are required to keep digital VAT business records and send VAT returns using Making Tax Digital (MTD)-compatible software from 1 April 2019.
Following the ministerial announcement in 2017, MTD will not be mandated for other taxes until at least April 2020, but businesses can get involved in the Income Tax pilot now on a voluntary basis.
This Making Tax Digital for Business - stakeholder communications pack supports HMRC’s partnership working arrangements with stakeholders, who can use the contents to inform their own communications activity and key messages for their clients, customers or members.
MTD for VAT – the pilot is now open for VAT businesses and their agents who are mandated to use the service from April 2019.
MTD for Income Tax – this pilot is available for the self-employed with income from one source of self-employment and landlords (except those with furnished holiday lettings).
Full details are within the guidance on Making Tax Digital for Business - stakeholder communications pack.
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The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
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