HMRC outlines further Making Tax Digital plans
HM Revenue & Customs (HMRC) has published a series of consultation documents outlining further plans for the Government’s Making Tax Digital initiative.
The measure is intended to create a ‘transparent and accessible tax system fit for the digital age’.
The consultation documents reveal that businesses and landlords with an annual turnover of less than £10,000 will not be required to produce quarterly reports or record information digitally.
The Government also stated that it will consider delaying the start of Making Tax Digital for a further group of small businesses to give them extra time to get used to digital record keeping and quarterly updating.
The six consultation documents target specific customer groups or reforms, and seek views on the Government’s Making Tax Digital plans.
The documents also confirm that those who cannot go digital will not be required to.
Commenting on the plans, Jane Ellison, Financial Secretary to the Treasury, said: ‘This new system will make the UK’s tax administration more efficient and straightforward and will offer businesses greater clarity when it comes to paying their tax bills.’
However, critics of the Making Tax Digital plans have suggested that digital tax returns will be an unnecessary burden on businesses.
Frank Haskew, Head of the Tax Faculty at the Institute of Chartered Accountants in England and Wales (ICAEW), commented: ‘This is not the time to be rushing through fundamental changes to business processes that are likely to result in major upheaval and extra costs, especially when the business benefit to the UK has not been clearly demonstrated.’
Under the Government’s plans, the changes to the tax system will be introduced gradually between 2018 and 2020.
The consultation period runs until 7 November 2016.