A lot has changed since we reported on Making Tax Digital back in October. So, we thought we do an update on MTD and what is going on with it now.
After much talk about Making Tax Digital, it was announced that the initiative would be removed from the Finance Bill 2017. This came after the Chartered Institute of Taxation (CIOT) wrote a letter to Chancellor Phillip Hammond. Within the letter, he urged the government to just have the core elements in the bill. Thus allowing for the more complex issues to be debated about after the election. This meant the Finance Bill decreased from 762 to 140 pages.
The ACCA welcomed this decision, with the head of tax at ACCA, Chas-Roy-Chowdhury, commenting that the “ACCA has raised some serious concerns about the implementation plan for MTD, and we advised at last week’s Treasury Select Committee hearing that it be delayed until after the general election to ensure that there is time for full and comprehensive debate.”
The ICAEW also thought the removal of MTD from the bill was sensible. However, some have questioned whether this measure would be a permanent one. These questions were recently answered by the Queen’s speech at Parliament. In which, she mentioned that there will be a Summer Finance Bill 2017. However, it was not announced whether the MTD or what exactly would be part of it.
The government will have until 20 July 2017 to think about any changes that they wish to make to the bill before the start of the summer recess. The government have been urged to give more detail about what is it to be included in the bill and the timescales of its implementation. Thus, allowing for the legislations to not be rushed with proper scrutiny and oversight.
MTD appears to be a positive move. As it’s implementation would mean that tax returns will be abolished within five years. Allowing for the majority of the UK to never have to think about it again!