HMRC update on making tax digital pilots

Released 8 August 2017

HMRC have provided an update on the development of their Making Tax Digital (MTD) service following the Government’s announcement on 13 July 2017 that it will include legislation in the next Finance Bill, but from April 2019 for VAT only and not before April 2020 otherwise.

Under the revised timetable, MTD for Business (MTDfB) will be available on a voluntary basis for the smallest businesses, meaning that businesses and landlords with a turnover below the VAT threshold will be able to choose when to move to the new digital system for VAT and for other taxes.

HMRC has confirmed that the first businesses have already started keeping digital records and providing updates to HMRC as part of a live pilot to test and develop the MTDfB service for income tax and they will continue to develop and expand this pilot over the coming months before starting to pilot MTDfB for VAT by the end of this year - starting with small-scale, private testing, followed by a wider, live pilot starting in Spring 2018.

For more information, see Next steps on the Finance Bill and Making Tax Digital.

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