As expected, HMRC confirmed on 13 July 2017 that they will be delaying the introduction of MTD. This followed months of concerns being raised by businesses, professional bodies and MP’s. MTD will now be compulsory from April 2019, for VAT purposes only.
Under the new timetable:
– VAT registered businesses over the VAT threshold (currently £85,000) will be required to keep digital records.
– Digital records will initially only be required for VAT purposes.
– Business will not have to keep digital records or report quarterly for other taxes (e.g. income tax and corporation tax) until at least April 2020.
– Businesses below the VAT threshold will be allowed to volunteer for MTD and other taxes.
HMRC will begin to pilot MTD for VAT by the end of 2017, starting with small-scale, private testing, followed by a wider, live pilot in Spring 2018.
The Government have stated that they will not widen the scope of MTD beyond VAT before the system has been proven to work.
While many accountancy practices are choosing to close rather than embrace these changes, here at Zoo we love technology and are getting ahead of the game with heavy investment in several apps to help businesses with the transition to MTD.
Zoo Accounting