03
August
2018
In the Friday email of 28 September last year we reported that HMRC was intending that by 2020, most businesses, self-employed people and landlords would be required to keep track of their tax affairs digitally and update HMRC at least quarterly via their digital tax account. HMRC have now announced that from 1st April 2019 Making Tax Digital (MTD) will be introduced for Value Added Tax (VAT) only, with digital record keeping and reporting required for all VAT registered businesses above the VAT registration threshold of £85,000pa. All VAT registered businesses will be required to maintain digital records, send their VAT returns and comply with year-end VAT reporting to HMRC online using third party software. Sports organisations that register voluntarily for VAT because they are beneath the VAT threshold are exempt but charities and Community Amateur Sports Clubs (CASCs) which are compulsorily VAT registered are not and must comply. There is an exemption where the implementation of MTD is considered not reasonably practicable, for example, due to the remoteness of their location, but this is not expected to apply widely. Invoices and receipts will not have to be created or stored digitally but transactions and other records will need to be maintained digitally. MTD for other taxes e.g. corporation tax and income tax will not be introduced until April 2020 at the earliest. As regards MTD for corporation tax, there may be exemptions for charities and CASCs but this has not yet been confirmed. HMRC has published an Overview of MTD and for those of you who would like in-depth details then HMRC’s MTD Technical Note may be of interest. Please LOGIN to read the full article.
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