HMRC postpones MTD for ITSA to 2024
The Government has delayed the introduction of Making Tax Digital for income tax self-assessment (MTD for ITSA) to 6 April 2024 to give individuals and businesses more time to prepare after the challenges they've faced during the pandemic.
Financial Secretary Lucy Frazer announced the delay to the House of Commons on 23 September 2021, adding that the Government remains committed to the system designed to simplify the UK tax system.
The basis period reform, which would require unincorporated businesses to align their accounting periods with the tax year, will also be delayed to at least 2024, with a transition year not coming into effect before 2023, Frazer added.
The Institute of Chartered Accountants in England and Wales welcomed the delay, saying the original start date for MTD for ITSA was "far too soon and risked causing serious damage to the UK tax system".
Alison Hobbs, chair of the agent services committee organised by the Chartered Institute of Taxation and Association of Taxation Technicians, agreed, adding:
"The delay gives HMRC a fighting chance of achieving the goals of MTD while limiting the confusion and costs for individuals who are reeling from the impact of the pandemic."
Reach out to us to discuss MTD for ITSA.