HMRC releases further information on digitising tax
Following consultations with the business community, HM Revenue & Customs has released further information on their Making Tax Digital initiative.
HMRC received over 3,000 replies from the consultations.
The new information is intended to show how digitising the tax system will help to benefit small businesses.
Self-employed workers will be required to make quarterly reports to HMRC. However, it will not be compulsory for self-employed workers and property landlords that have a turnover of less than £10,000 to keep digital tax records.
Charities and businesses which cannot report digitally will also not be forced to keep digital or quarterly records.
HMRC Director General of Customer Strategy and Tax Design Jim Harra stated: “We know that the majority of businesses want to get their tax right first time, but the latest tax gap figures show that too many find this hard, with more than £8 billion a year lost in tax as a result of avoidable taxpayer error by small businesses.”
He added that Making Tax Digital will help businesses get their tax right the first time, and it will help to reduce the likelihood of errors, lower the chance of unwelcome compliance checks and give them more certainty that they are doing things right.
The Making Tax Digital initiative is set to launch in April 2018, but HMRC plans to pilot the scheme to businesses in April this year.
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