Making Tax Digital (MTD) update
By Robert Leggett
The Government have finally given in to the constant pressure over Making Tax Digital (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 and landlords, many of whom were previously going to have 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 record keeping software to be up and running by that time.
Although the requirements of the VAT filing are not yet known, it is likely that the latest versions of most mainstream accounting software will be updated to facilitate the new regime. However, there could be difficulties with more complex VAT affairs, (such as partial exemption, capital goods scheme etc.) which currently see manual adjustments to computerised records.
Even with MTD postponed, it may still be the right time to reassess your accounting software, and decide whether you have the right package for the future. We are able to assist you with both cloud based and other digital record keeping software, approaching this in a flexible way to suit your business.
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