20 December 2022
A bit of breathing space for Making Tax Digital for Income Tax
Yesterday it was announced by the Treasury that HMRC’s Making Tax Digital for Income Tax (MTD ITSA) for sole traders and landlords won’t become mandatory in April 2024 as expected. Instead, MTD ITSA will be delayed by two years to April 2026, with partnerships also pushed back from April 2025 to a date yet to be confirmed. It is believed that this decision has been taken to allow systems and technology to be fully developed and tested, as well as respecting the current challenging economic environment currently faced by us all.
Initially, the changes were going to apply to sole traders and landlords with income over £10,000, however HMRC have now decided that this would impose too great a burden on small businesses. Therefore, further good news will see the income limit increased to £50,000 in 2026, reducing to £30,000 in 2027. Further consultation is taking place on how they manage MTD in the future for those under the £30,000 income threshold.
Of course, we welcome the decision made by the Treasury, as it allows us to continue to focus on supporting our clients through any upcoming economic challenges whilst still ensuring we help them meet the MTD requirements of the future.
Whilst this decision means that going digital is not mandatory, if anyone still wishes to pursue this route and explore any efficiencies that going digital would bring, then we would be happy to discuss your options with you. You can speak to your usual Dodd & Co contact, call us on 01228 530913 / 01768 864466 or email us on hello@doddaccountants.co.uk
