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HMRC confirms April 2018 start date for Making Tax Digital reporting

Posted by Wolters Kluwer News on 09-Feb-2017 15:00:00

In late January HMRC provided their response to the Making Tax Digital consultation period, with the main news being that Making Tax Digital reporting for businesses will begin in April 2018, as per original plans. Despite concerns around the ambitious pace at which HMRC are implementing the changes, HMRC have chosen to press on due to overwhelming support for the digitisation of tax in the majority of consultation responses, with more than 3000 responses received in total.

HMRC have confirmed that they are to review the originally proposed £10,000 threshold for exemption, and that penalties will not be enforced during the initial launch period. In an interview with CCH Daily, Theresa Middleton, HMRC Director of Business Customer and Strategy, stated: ‘We have not included the exemption threshold and deferral threshold as the government has decided that it needs more time to consider these issues, but they will be confirmed before July 2017 when the legislation is laid.’ She continues: ‘These reforms are more important than ever as the errors by taxpayers have gone up to £8bn. We received broad support for the direction of travel [in Making Tax Digital], although there was concern about the pace, costs to business and capability of the smallest businesses to make changes.’

As for concerns of the ability to use spreadsheets to manage records Middleton offers: ‘Businesses will be able to continue to use spreadsheets for record keeping but must keep to HMRC requirements, but they might need to combine the spreadsheets with some other software to clean the data.’

The year-long testing period proposed in the original consultation documents has also been confirmed, with HMRC hoping to attract businesses and agents to trial Making Tax Digital from April 2017.

Middleton said: ‘The agent services project needs to be delivered by April as we need agents to be able to join the Making Tax Digital trial. We are building a range of services, which will be available through APIs and some will be bundled, which will connect directly with our system'.

'It is very much part of our plan to enable agents to be part of the trial from April,’

Topics: MTD | Tax | All posts