The Government have finally given in to the constant pressure over MTD, and announced that quarterly reporting for income tax and corporation tax will be delayed until “at least” April 2020.
The announcement will come as a relief to businesses, landlords and their advisors, many of whom were previously having to get ready to implement MTD from as early as April 2018. However, it is disappointing that it has taken the Government this long to recognise that the timetable was unrealistic, prompting a huge amount of work and investment which may now prove unnecessary.
However, the one area which has not been postponed is the switch to VAT returns being made via the MTD system from April 2019. This means that all VAT registered businesses with turnover above the VAT threshold, whether companies or unincorporated, are still likely to need MTD compatible software to be up and running by that time.
At Ensors, we are able to offer cloud based digital record keeping software to our clients, and have spent some time developing a flexible approach, which we were ready to roll out on a large scale. Even with MTD off the agenda for now, it may still be the right time to reassess your accounting software, and decide whether you have the right package. To that extent, the postponement of MTD won’t make a huge amount of difference to our work with clients on digital software. However, now we will be able to concentrate on working with those clients who are likely to see a genuine business benefit from new software, rather than MTD forcing us to roll out new software to clients who don’t need it from a commercial perspective.
The question remains though, apart from VAT, has MTD been postponed, or, with the Government having much bigger issues to concern themselves with, have we seen the last of it?