Industry News - 10th January 2023
The Treasury has announced that Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) will be delayed for two more years until April 2026.
The scheme was due to take effect from April 2024 and would have required all self-employed individuals and landlords with income over £10,000 to report earnings quarterly through the MTD for ITSA system.
However, in a written statement to Parliament, Victoria Atkins, Financial Secretary to the Treasury, confirmed that the mandation of MTD for ITSA will now be introduced from April 2026. Businesses, self-employed individuals and landlords with income over £50,000 will be required to join first. From April 2027, those with income over £30,000 will also be mandated to join.
Ms Atkins said:
‘The government understands businesses and self-employed individuals are currently facing a challenging economic environment, and that the transition to MTD for ITSA represents a significant change for taxpayers, their agents and for HMRC.
‘That means it is right to take the time needed to work together to maximise those benefits of MTD for small business by implementing gradually.’
The Treasury said that the government now intends to review the needs of smaller businesses in regard to MTD for ITSA and will consider how the initiative can be shaped to meet their needs.
Once the review is finalised, the government will outline plans for any further mandation of MTD for ITSA.
The statement also confirmed that the government will not extend MTD for ITSA to general partnerships in 2025, but it ‘remains committed to introducing MTD for ITSA for partnerships at a later date‘.
Internet link: UK Parliament website