The one-year delay to the introduction of the next phase of Making Tax Digital (MTD) for income tax means that accountants have more time to prepare, but it is still a priority, explains Emily Coltman, chief accountant at FreeAgent
New poll data from FreeAgent reveals that only 7% of accountants are ready for the next phase of Making Tax Digital (MTD), while half (49.5%) plan on using the extra year to help prepare. The vast majority (77.4%) are in favour of the year extension from the government for MTD for income tax self assessment.
It is less than six months until the next stage of MTD comes into effect. From April 2022, the UK’s VAT registered small businesses and sole traders who have voluntarily registered for VAT (typically because they have VATable sales of less than £85,000 a year) will have to start keeping their records and reporting their VAT digitally.
While the deadline for MTD for Income Tax Self-Assessment (ITSA) for businesses and landlords has recently been extended to 2024, this change will impact over 4.2 million taxpayers with businesses or property income over £10,000, including landlords and sole traders.
