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Making Tax Digital (MTD) Still Some Way Off

Making Tax Digital (MTD) Still Some Way Off

Whilst HMRC are making positive noises about the progress of MTD, those businesses which pay VAT had to start submitting quarterly returns this year.  Of the one million businesses affected, nearly one quarter missed the August 7th deadline to submit their 1st return.

Recognising that implementation was not as easy as advisors had told them, HMRC has even gone as far as to waive fines altogether for those who missed the 7 August deadline, as long as the VAT return was filed on time using the old HMRC portal, in favour of supporting those businesses who are doing their best to make the transition.

Despite not levying fines, HMRC did confirm that those who had failed to meet the deadline would 'receive a letter telling them that they missed the deadline and asking them to take action" and that 'sanctions will remain possible in cases of deliberate non-compliance".

What does this mean for landlords?  The last published date for landlords to move onto the MTD scheme was April 2020 but unofficially, we have been hearing that this is not possible - simply because the relevant details of how it would all work would need to be published by now, if accountant and software companies were to be ready in time.  However, until it is officially changed, you do need to consider that sometime in the next year or two, you will need to submit quarterly returns.

Our advice is as follows:

  1. Wait until the date is clearly set and the details fully outlined
  2. In the interim, do not switch to any 'MTD-ready" solutions as we cannot tell what is MTD-ready until the details are confirmed
  3. Also, don"t change the way you do things just because of new tax requirements. If what you do today works well for you, you should look for a solution that allows you to carry on with maybe small changes rather than have to change your whole administration system

As always, we will keep members up to date via news items and on our MTD dedicated site,  landlordmtd.com

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