MTD for Income Tax – delayed until April 2026
Yesterday (19 December 2022), HMRC confirmed that they will be postponing the introduction of MTD (Making Tax Digital) from April 2024 to April 2026 and relaxing to whom the mandation of MTD will apply.
Prior to the announcement from April 2024 any individual with gross income from property and / or self-employment in excess of £10,000 would have been required to maintain digital records and start to make quarterly submissions to HMRC.
The announcement from the government has pushed the commencement date back until April 2026 and it will only now only be mandatory for those individuals with gross income from property and / or self-employment in excess of £50,000.
From April 2027, the intention is for it to be extended to those with gross income between £30,000 and £50,000.
For those with gross income below £30,000 the government intends to wait until post April 2027 to consider whether it will be extended further. There is also no set date for the when general partnerships will be brought into MTD, with the original commencement date of 2025 now also having been pushed back indefinitely.
Whilst the pushing back of the commencement dates and the increase in the mandatory threshold for MTD is welcome news, and it is good to see that the government have taken on board the representations made to them, there is still a clear desire to push for MTD from within government.
For those who have already taken steps to digitise their record keeping then they will be able to adopt MTD early if they choose, for those still working towards this it gives some more breathing space to get your systems in place. For any assistance in digitising your record keeping and what MTD may mean for you in the future, please contact your usual Westcotts office.