Delayed Making Tax Digital for Income Tax Self Assessment
Posted on 10th February 2023 at 15:03
Making Tax Digital for Income Tax (MTD ITSA) delayed until April 2026.
We cover the details - and why your business should take a digital approach now.
The original plan was to have all taxpayers using the ITSA system submit their tax returns through MTD-compatible software from April 2020. The government says MTD ITSA is being delayed because the scheme represents a “significant change to taxpayers” who are in a “challenging economic environment.”
Ready to Join MTD early - speak to us:
We are delighted to announce that Chart Accountancy has been included in the HMRC's pilot. This means that our clients can participate voluntary in Making Tax Digital (MTD) for Income Tax. We are ready to initiate MTD before April 2026.
We cover the details - and why your business should take a digital approach now.
• Know more about their finances
• Make fewer mistakes
• Make better business decisions:
While there have been some shifting deadlines, MTD will be here to stay. Making Tax Digital will be a new system to mandate tax payers to submit details of their revenue and costs to HMRC at least four times a year, so there will be an accurate, up to date picture of how much tax is due throughout the year rather than through filing of one annual Self Assessment tax declaration.
What is the deadline for MTD?
HMRC is introducing Making Tax Digital in stages. The mandatory use of MTD for ITSA software will be phased from April 2026:
Self-employed individuals and landlords with an income of over £50,000 joining first. They will need to keep digital records and provide quarterly updates on their income and spending to HMRC through compatible software.
Those with income between £30,000 and £50,000 will need to comply from April 2027.
The Treasury will review the needs of smaller businesses in regard to MTD for ITSA, and will consider how the initiative can be shaped to meet their needs.
This delay will give businesses more time to prepare for the transition to the new system, which will require them to keep digital records and submit their tax returns through software that is compatible with MTD. The government hopes that the extra time will allow businesses to adapt to the new system without facing undue hardship or additional costs during a challenging economic period.
The delay of MTD for ITSA is a positive step for businesses and will ease the burden on them. However, it is important to note that businesses can still voluntarily sign up for MTD now if they wish to do so.
Speak to us
If you would like to know more about Making Tax Digital, do not hesitate to get in touch with our team. We have years of experience in accounting for contractors, freelancers and small businesses so whatever your query – we are here to help.
To speak to a member of our team call us on 0333 772 7753 or email our team at [email protected] and we will be in touch as soon as possible.
Tagged as: Making Tax Digital, MTD
Share this post: