HMRC MTD Consultation

27th October 2016

Making Tax Digital: Prepare or man the barricades!
HM Revenue & Customs have just published their second webinar on their Making Tax Digital (MTD) project, including a plethora of questions and answers. While the tone was very touchy-feely, as the presenters talked about the HMRC’s “customers”, the underlying iron fist could clearly be sensed:

  • Yes, there will be some businesses that avoid the requirements, principally those with an annual turnover of less than £10,000. If your turnover is greater than that, you are in.
  • No Internet connectivity? Okay, you will not have to make quarterly submissions.
  • Connectivity but no computer? Tough, you are in.
  • Over 60? So what, you’re in.
  • And so on.
  • How will adherence to the new regime be imposed? By a new points-based penalty system. There’s a surprise.

It was admitted that the Brexit vote delayed the launch of the consultation period which, it was stated, HMRC were anxious not to shorten. A cynic might suspect that MTD is preordained and nothing short of insurrection will cause more than a little fraying at the edges of the proposals. So be warned. In 18 months time you will need to have a computerised bookkeeping system and be ready to submit quarterly data to HMRC – or be manning the barricades!

Cloud accounting packages represent the optimal way to address these issues but it would be unwise to put off their adoption until the last minute. If you are a sole trader or partnership or receive gross rental income of over £10,000, speak to one of our advisers about the changes and your options now.



 
Other items in Blogs
 
Lucy Bayliss
12th November 2019 Finance charges for landlords – The knock on effects

  Since 6 April 2017, changes are being gradually introduced to restrict the relief available to landlords in respect of their finance costs. Under the old rules, the interest element of the mortgage payments was 100% allowable for income tax purposes. However, this is gradually being replaced with a 20% tax reducer instead. The timetable…

Read More »

Barbara Nicholas
1st November 2019 Brexit halts Budget

With all the uncertainty over Brexit, we waited a long time to learn the date of Sajid Javid’s first Budget.   Finally we learnt this was to take place on 6th November, amid great excitement at muted suggestions about the possible abolition of Inheritance Tax and radical changes to stamp duty.   The bubble has…

Read More »

Vanessa Pearson
28th October 2019 Off-Payroll Worker Tax Rules: Be prepared!

Knowledge based contractors working in the private sector will hopefully now be well aware that, subject to any possible Government last minute change of heart, new tax rules are coming next April. For many, who are not currently following IR35 rules, this will mean a large increase in the tax they pay; perhaps tens of…

Read More »

Matilda Mawson
24th October 2019 I’ve got 99 Problems but my Tax Return isn’t 1!

There are now only 99 days before the tax return filing deadline of 31 January 2020. Do not delay – file it today! Not sure if you need to file a tax return? HMRC have a questionnaire that only takes a few minutes and will check whether any of your income or gains will require…

Read More »

Jeannette Hume
24th October 2019 R&D Tax Claims: HMRC finally go-digital.

In February 2019 HMRC introduced an online tool to submit Research & Development tax relief claims (both SME and RDEC claims). It is still necessary to make the claim on a company tax return (form CT600), but the accompanying detailed R&D project information can (but does not have to) now be submitted by completion of…

Read More »

Ruth Pearson
17th October 2019 Is it too early to talk about Christmas!

In December 2018 HMRC wrote to employers to advise of a temporary easement on reporting PAYE information in real time. This was for a number of reasons, one of which could be due to businesses closing over the Christmas period and therefore having to pay staff earlier than normal.   HMRC have received feedback from…

Read More »