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Podcast: Reactions to the MTD delay

17th Mar 2017
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Last week's Budget saw Chancellor Philip Hammond announce a one year deferral of Making Tax Digital (MTD) obligations for smaller unincorporated businesses and landlords until April 2019.

While the move was broadly welcomed by businesses, accountants and representative bodies, what do the government's concessions actually mean, and how much of a relief are they actually going to be?

Joining the AccountingWEB podcast to get to grips with the announcements are Paul Aplin, tax partner at AC Mole and Son, AccountingWEB global editor John Stokdyk and Mark Purdue, Product Manager - Tax Products at Thomson Reuters.

We are also joined by Matt Flanagan, managing director at cloud transformation firm BlueHub, who will be outling what firms are (and should be) doing to prepare for MTD.

The AccountingWEB Making Tax Digital podcast is recorded on a monthly basis. If you have any burning questions you can ask them in the comments box below and our crack panel will do their best to answer them next time around.

You can listen to the podcast by clicking play on the window above, visiting our Soundcloud page or subscribing to this podcast via iTunes, aCast, Soundcloud or your podcasting app of choice.

Replies (5)

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By Rangith Athauda
19th Mar 2017 10:28

Hi There

We don't know what the threshhold fo unincorporated clients until july 2017.

Why waste time now ?

Thanks (1)
By Marcie
19th Mar 2017 14:53

Do I Understand correctly- none of my clients are immediately affected by MTD?
Landlords/traders with a gross income of under £85,000 will not now have to join the program until 6th April 2019?
Landlords/traders with a gross income of over £85,000, (at which time they are obliged to register for VAT) will not have to join the program until 6th April 2019?
VAT registered partnerships will join the program on 6th April 2019
Incorporated companies will join the program on 6th April 2020?
Many thanks
Marcie Bird

Thanks (0)
rebecca cave
By Rebecca Cave
21st Mar 2017 14:21

From the replies above many people are still confused about the dates from which individual landlords and other business will start quarterly reporting under MTD.

First - forget about whether a business is VAT registered or not. It is the level of turnover that determines when a business/landlords joins MTD. The threshold first wave of MTD joiners happens to be set at a turnover level equal to the VAT registration threshold, but this does not mean the taxpayer is required to be VAT registered.

Landlords of residental property, doctors and dentists will genreally not be VAT registered as thier sales are exempt from VAT. But these people will join MTD from the first accounting period that start on and after 6 April 2018, where thier turnover for the previous period was in excess of the VAT threshold (£85,000 from 1/4/17)

April 2019 is going to be the big bang for MTD.

Most businesses will start some quarterly reporting for accounting periods starting on or after that date. All those unincoproated businesses who are deferred from April 2018, will start to make quarterly reporting from the accounting period that starts on or after 6 April 2019

All businesses who are VAT registered will have to make some form of quarterly reporting for VAT periods that start on or after 1 April 2019, but only in respect of VAT figures. HMRC hasn't made it clear exactly what data will have to be reported yet.

Only companies who are not VAT registered will be able to wait until 2020 to start to make quarterly MTD reports.

Thanks (3)
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
21st Mar 2017 16:25

Thank you for clarifying that, Rebecca!

I picked up Marcie's query with Mark Purdue from Thomson Reuters and he offered a very similar reply.

Mark added that it is worth noting that combined turnover is tested for these MTD thresholds. For example, a sole trader turning over £70k in their business and rental income of £20k will need to report from 2018.

Combined turnover is also tested for the £10k exemption threshold for unincorporated business and landlords.

And just to complete the sequence, from April 2020 any business or landlord registered for corporation tax must start reporting for CT - "although we have no information on what this means in reality yet", added Mark.

Thanks (0)
By GWSaunders
28th Mar 2017 12:34

I have been appointed as accountant for a discretionary trust, the beneficiaries are 3 grandchildren with total expected turnover of c. £9000 pa

Does MTD apply here?

Thanks (0)