Government and HMRC have listened to representations and put back the implementation of MTD ITSA and potential reforms to basis periods. The new MTD ITSA start date of April 2024 for the self-employed and landlords has now been set in legislation, providing the certainty that has been lacking, says ICAEW.
Making tax digital - articles
Features and articles from ICAEW on the Making Tax Digital (MTD) programme in the UK.
HMRC is trialling a forced closure of the online VAT return for 800 businesses that should be complying with Making Tax Digital for VAT. ICAEW warns that these businesses will not be able to file VAT returns due on 7 October 2021 unless they have signed up to MTD VAT.
Pushing through proposals to change basis periods ahead of the expansion of Making Tax Digital will cause as many problems as it solves and would be a backwards step for affected businesses, warns ICAEW.
ICAEW’s representation to the Tax Administration Framework Review pointed out that the criteria for who does and doesn’t need to file a self assessment tax return are arbitrary and need to be reviewed. The Tax Faculty explains the rules as they currently stand.
HMRC has confirmed that that it cannot accept bulk transfers of client authorisations to a different agent code. A process to allow agents to update their firm’s details in their agent services account is now available. ICAEW’s Tax Faculty explains HMRC’s updated guidance.
This month’s top technical stories include information on the fifth SEISS grant, ICAEW’s response to the government’s proposed reforms for audit and corporate governance, and the FRC’s new Quality Management standards.
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Digital transformation can mean different things to different people; it is a catchall term describing the implementation of new technologies and processes to improve business operations.
The government has moved swiftly to consult on draft legislation to reform basis period rules before MTD ITSA becomes mandatory. ICAEW is concerned that changes will be rushed through and disappointed that the normal consultation process is not being followed.
ICAEW welcomes HMRC’s vision of a more flexible and responsive tax system outlined in the Tax Administration Framework Review but warns that significant challenges, such as creating a single identifier for taxpayers and consolidation of tax systems, can only be met if HMRC is properly resourced.
ICAEW has identified the need to establish income tax, national insurance and capital gains tax liabilities in a single system as a priority for the Tax Administration Framework Review.