The House of Common's Public Accounts Committee (PAC) has launched a new call for evidence, ‘Progress with Making Tax Digital' (MTD). This is as part of an inquiry in which they will question Jim Harra, Chief Executive at HMRC about progress made towards MTD and whether the latest plans provide confidence that the programme will deliver value for money.
The PAC notes that MTD aims to help businesses reduce errors in their tax records, through the use of digital record-keeping and by requiring them to submit quarterly updates using MTD compatible software. HMRC also intends to move processes and tax records onto a modern tax management platform.
In December 2022 HMRC announced that it was going to delay the introduction of MTD for Income Tax Self Assessment (ITSA) and changed the reporting thresholds for Sole Traders and Landlords. Reporting for Corporation Tax is not due to commence until 2026 and there is as yet no start date for Partnership reporting.
The PAC inquiry aims to cover:
- HMRC’s original vision and plans
- progress made before the December 2022 announcement
- How realistic HMRC’s latest plans for MTD are.
The call for evidence does not have a specific set of questions and simply asks interested parties to submit written evidence via an online form by 8 June 2023.
Following the ICAEW’s recent letter to HMRC calling for a re-think of MTD for Income Tax it remains to be seen whether this inquiry may result in any further delays to its introduction or any change in the planned scope for MTD for Income tax and Corporation tax.
The inquiry sits alongside an ongoing investigation into Making Tax Digital (MTD) by the National Audit office.
Useful guides on this topic
Making Tax Digital: Index & timeline
When does Making Tax Digital (MTD) apply? What does Making Tax Digital really mean? How will it affect you? Does MTD mean quarterly reporting? Is my business exempted from Making Tax Digital?
Making Tax Digital: Survival guide (for the self-employed & landlords)
The way that some self-employed taxpayers report their business profits to HMRC is set to change under the Making Tax Digital (MTD) for business regime, when it begins to apply to Income Tax reporting.
MTD: Toolkit for accountantsMTD: Toolkit for accountants
What is the current timetable for Making Tax Digital (MTD)? How will it work? Which clients will be excluded? What planning needs to be undertaken?
External link
Call for Evidence Progress with Making Tax Digital
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