Making tax digital (MTD)
There will be a fundamental change to the way the tax system works – transforming tax administration so it is more effective and easier for tax payers to understand. A Making Tax Digital (MTD) pilot scheme will begin in April 2017 and run until April 2018.
HMRC will have moved to a fully digital tax system by 2020 where:
- Form filling is eradicated – tax payers shouldn’t have to tell HMRC information which it already knows.
- Unnecessary time delays are eliminated – the tax system will operate in “real time” keeping everyone up to date and removing the risk of missed deadlines.
- Tax payers will have access to their own digital accounts – all information will be automatically uploaded.
The reform aims to transform the experience of millions of tax payers by making the process simpler; ultimately reducing the burden for business owners. You will be able to register, pay, file and update your information at any time of the day or night and at any point in the year. You will no longer have to wait until the end of each tax year before knowing how much tax you should pay, avoiding any surprises and helping you to plan your financial affairs with far more certainty.
Of course, you will still be responsible for ensuring that your tax records are correct and advising HMRC about information that is not reported through other means.
Please feel free to contact Michael Burgess on 01782 279615 who will be happy to answer any questions you may have on Making Tax Digital (MTD).