We are pleased to confirm that HMRC has today launched six Making Tax Digital (MTD) consultation documents. The MTD Roadmap, published in December 2015, set out the government's plans to deliver a fully digital tax service by 2020. It is widely recognised that the reforms are ambitious and radical and will impact significantly on accountants and their clients. It is important that HMRC consults widely with interested parties to help shape these changes.
Although this marks the start of the formal consultation period, the HMRC have been engaging extensively with stakeholders since MTD was announced last year and much of the content of the consultations has been informed by that engagement. Each consultation document contains details of how to get involved in the discussion over the next 12 weeks and how to formally respond to the consultations. Wolters Kluwer is involved in the consultation process. The six consultations set out detailed plans on how HMRC propose to make tax digital and to simplify the tax system, covering:
- How digital record keeping and regular updates will operate;
- Options to simplify tax for unincorporated businesses, including how the self-employed map accounting periods onto the tax year, extending cash basis accounting and reducing reporting requirements for unincorporated businesses;
- Extending cash basis accounting to unincorporated property businesses, making life simpler for landlords;
- How the voluntary pay as you go arrangements announced at this year's Budget will work;
- Changes to tax administration to effectively underpin compliance with MTD and ensure we have a fair and proportionate penalties regime; and
- How HMRC will make better use of the information we currently receive from third parties to provide a more transparent service for customers.
- Each consultation focuses on specific elements of the MTD reforms.
The consultation period will run from 9.30am Monday 15 August to midnight Monday 7 November 2016.
We will update you on our thoughts from the consultation period and any information that we gain from this process.