Save content
Have you found this content useful? Use the button above to save it to your profile.
business man on a big question mark | accountingweb | MTD – what does new legislation tell us
iStock_sesame_uncertain

New MTD updates fail to fully address uncertainty

by

New legislation and guidance for Making Tax Digital introduces some welcome changes, but there are still unanswered questions. Emma Rawson takes a closer look.

27th Feb 2024
Save content
Have you found this content useful? Use the button above to save it to your profile.

The past few weeks have been busy for those following the ups and downs of Making Tax Digital for income tax self assessment (MTD ITSA). We’ve had research reports, an updated policy paper and a rather robust response by HMRC to criticism received from the Public Accounts Committee.

We also received long-awaited updates to regulations and an accompanying update notice. Taken together, these clarify some important aspects of MTD ITSA.

Why are the regulations so important?

The main primary legislation paving the way for the introduction of MTD ITSA is found in Finance Act 2017. However, much of the detail on what will actually be required, and when, is relegated to secondary legislation – the Income Tax (Digital Requirements) Regulations 2021.

These regulations were first issued three years ago and are now terribly out of date. They still set the income threshold for MTD ITSA at £10,000 and the commencement date as April 2024. 

To prevent MTD ITSA starting in just a few weeks, we urgently needed some “amending regulations”. Following a short period of consultation over the festive period, the final version of these was laid in Parliament on 22 February in the form of the Income Tax (Digital Requirements) (Amendment) Regulations 2024

Register for free to continue reading

It’s 100% free and provides unlimited access to the latest accounting news, advice and insight every day. As well as access to this exclusive article, you can:


Content lock down, tick icon

View all AccountingWEB content


Content lock down, tick icon

Comment on articles


Content lock down, tick icon

Watch our digital shows and more

Access content now

Already have an account?

Replies (59)

Please login or register to join the discussion.

avatar
By twohaporth
02nd Mar 2024 11:19

The trouble is that the HMRC systems are rubbish, not that I think computers are very good at getting things right or spotting things wrong. And the interface between human and computer is always going to be a source of error. How will a computer spot the back pocket money which has no paperwork? Answer it won't but HMRC will believe what the computer says so the computer sophisticated will run rings around HMRC who don't and won't have the knowledge to even know it.
Perhaps the move to digital will have a benefit then even if only to the shadier members of society.

Thanks (0)
Replying to twohaporth:
avatar
By Rob Swan
02nd Mar 2024 14:24

HMRC 'won't' "see" most MTD returns, ITSA or any other - I rather think that's the whole point. The whole MTD thing is about 'automation'; If the computer says it's OK, no human will ever set eyes on anything, save for a few 'random samples' plucked out of the digital void. It's easy for big-wig IT consultancies to sell such pipe dreams to HMRC because they actually believe it will all happen exactly as it's been sold to them. The rest of us are a little more sceptical (realistic).

Thanks (0)
avatar
By 0098087
05th Mar 2024 21:23

It really feels like everything in this country. No one knows what anyone is doing

Thanks (2)
Replying to 0098087:
avatar
By johnjenkins
06th Mar 2024 10:08

I know exactly what you mean. It is a bit better up North.

Thanks (1)
Replying to johnjenkins:
avatar
By Rob Swan
06th Mar 2024 12:01

johnjenkins,
Maybe. (from Up North - Durham coast). But honestly, I'm not sure even the people doing the doing really know what they're doing. Maybe within their own small domain, but 'damage' to the whole (country), seems pretty much the net result everywhere. EG. The barriers to entry in business and the costs of being in business have grown exponentially in the last 30 years. Nobody in Gov't has the balls to lay it on the table, let alone offer any real solution - just more red tape and regulation, (eg AML!). And that's the backbone of the UK economy!

Thanks (0)
Replying to Rob Swan:
avatar
By 0098087
06th Mar 2024 12:18

I will never forgive them for taking us out of the EU through blatant lies and racism

Thanks (1)
Replying to Rob Swan:
avatar
By johnjenkins
06th Mar 2024 15:56

A lot of the problem stems from non high techers. Government expect everyone to jump on the high tech wagon and everything will be hunky dory. Once MTD comes in April 26 it will really show up the differences, that's if there are still small business about then.

Thanks (0)
avatar
By Agutter Accounts
06th Mar 2024 15:30

The threshold of £30k is still ridiculously low. It is simply unworkable.

Thanks (0)
Replying to Agutter Accounts:
avatar
By 0098087
06th Mar 2024 15:41

Just do not see why it is necessary.

Thanks (0)

Pages