Brexit causes HMRC to delay Making Tax Digital for individuals | WDM

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10
May

Brexit causes HMRC to delay Making Tax Digital for individuals

HMRC have delayed the full roll-out of Making Tax Digital (MTD) while the UK prepares to leave the EU in 2019.

MTD for individuals was scheduled to take effect from 2020, however the government have revealed that the plans have been put on hold to allow HMRC to focus on the UK’s Brexit preparations.

In a letter to tax professionals, HMRC stated: ‘We have made the decision to delay plans to release project capability to EU exit work. This means halting progress on Simple Assessment and real-time tax code changes.’

HMRC proceeded to say that the foundations for MTD for individuals have been laid, which will enable the government to return to the initiative ‘in the future’.

Responding to the news, Yvette Nunn, Co-Chair of the Technical Steering Group at the Association of Taxation Technicians (ATT), stated: ‘Given the unprecedented changes which will result from Brexit, it is only sensible that HMRC seek to prioritise their work.

‘There have been reports of inaccuracies in the information which HMRC have used in Simple Assessments to calculate tax bills. As a result, taxpayers are required to check these carefully once received, especially as they only have 60 days to correct any errors.

‘While we welcome the pause . . . we strongly urge HMRC to use the extra time given to iron out the known problems with Simple Assessment and dynamic coding before they hit play on them again.’

Meanwhile, HMRC confirmed that MTD for VAT is set to take effect from April 2019 as previously planned. From this time, businesses with a turnover above the VAT registration threshold (currently £85,000) will be required to keep digital records for VAT purposes and submit VAT returns using MTD functional compatible software.

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