HMRC is going to invite unincorporated businesses and landlords to participate in a Making Tax Digital (MTD) pilot from 3 April 2017.
The pilot will run for two full tax years – 2017/18 and 2018/19 – as HMRC encourages as many micro, small and medium sized businesses trading below the VAT registration threshold to adopt digital record keeping early, before the mandatory go live dates.
The main points are:
- Unincorporated businesses and landlords who pay income tax and class 4 national insurance and who have a total gross income above £10,000 a year will be invited to subscribe to the pilot from 3 April 2017.
- Volunteers will need to have MTD compatible software and to subscribe themselves into the pilot.
- HMRC will limit the number of daily subscribers to begin with, probably for the first six weeks or so, as it builds capacity and to ensure a smooth launch.
- A marketing campaign will begin from late May 2017 promoting the pilot.
- Accountants will be able to subscribe willing clients to the pilot at some point from July 2017 onwards.
- Volunteers will be able to retrospectively provide updates after the pilot has launched.
- HMRC does not intend to charge penalties for the late submission of quarterly updates during the pilot.
Up until now HMRC has been developing MTD in private beta mode with around 700 businesses and 18 software companies.
Further detailed information about Making Tax Digital is available on the abbeytax website.
Author: Guy Smith, Head of Technical Research