The Finance Bill 2017 which allows the introduction of Making Tax Digital (MTD) for VAT and Income Tax was published on 8 September 2017, including secondary and tertiary legislation which was published on 13 September 2017.
The proposed legislation is subject to an open consultation which closes midday on 10 November 2017.
The primary legislation will ‘give the commissioners ofHMRCthe powers to introduce regulations, which will set out the detailed requirements that businesses will have to meet’.
Draft Legislation
The government will ‘publish and consult on draft VAT regulations to be made under the powers above. The intention is to have made the necessary VAT regulations no later than April 2018.’
This gives businesses and software developers a notice period of 12 months to prepare for the VAT requirements which will come into force. Three key HMRC documents include:
Making Tax Digital for Income Tax – Regulations
Making Tax Digital for Income Tax – Notices
Income and Corporation Taxes Regulations
What is Making Tax Digital?
The Making Tax Digital scheme is part of the Government’s plans to make recording tax easier by submitting them digitally, and on a quarterly basis.
Businesses with a turnover above the VAT threshold which currently stands at £85,000 will be required to keep digital records, and businesses earning below the VAT threshold will be exempt until 2020.
Chancellor Philip Hammond confirmed that MTD will be made available on a voluntary basis to other businesses, for both VAT and Income Tax. The MTD scheme is expected to come into effect April 2019.
Autumn Budget
The Chancellor announced that the Autumn budget will take place on Wednesday 22 November 2017. Here is his announcement:
Today I’m announcing the date of the next Budget. Watch as I explain why it’s one of the most important days of the parliamentary calendar. pic.twitter.com/svSK4uK0S0
“” Philip Hammond (@PhilipHammondUK) September 12, 2017
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