In a barely disguised rebuke to the government and HMRC, the House of Lords has called for a last-minute delay to the roll-out of Making Tax Digital for VAT registered businesses.
The roll-out is due to take effect on 01 April 2019, from which point all businesses will be required to keep their records digitally and use accounting software to submit their VAT returns online.
The Lords are calling for the date to be put back until April 2020, arguing that many businesses will not be ready in time, principally because HMRC hasn’t done a good enough job of creating awareness amongst business owners.
The Chartered Institute of Taxation (CIOT) and Association of Taxation Technicians (ATT) has backed the report.
Adrian Rudd, Chairman of the CIOT/ATT Digitalisation and Agent Strategy Working Group, said:
"With just a few months to go before it kicks in, these knowledge gaps could mean normally compliant firms fail to fulfil their new obligations."
We’ll have to wait and see what the outcome of the Lords’ recommendations is, but our advice is to continue to prepare for 01 April 2019 regardless. If you are using one of the main cloud accounting packages such as Xero, there is no cause for alarm. You are already keeping your records digitally and probably submitting your returns online. If you are still relying on paper records though, it is worth us having a chat about getting you ready.
Get in touch
Please contact us on 01483 205850 for advice.