Government plans to digitise the tax process for business owners are still going ahead – despite a two-year delay – and agents and landlords have been urged to stay ahead of the game.

The NEG reported earlier this week that the Making Tax Digital (MTD) initiative now won’t come into force until April 2016 with HMRC saying this latest deferral will give business owners more time to transfer to the new system.

CONDITIONS

The Treasury blames difficult economic conditions for business as one of the main reasons for the delay, adding that implementing the change gradually will help maximise MTD’s benefits.

Tax return tech platform APARI – whose software was the first to gain recognition by HMRC – says it will continue to work on its MTD roll out.

Anish Mehta (pictured), APARI’s Chief Product Officer, says: “HMRC is still committed to its 10-year tax administration strategy and didn’t want this delay. MTD is yet another casualty of the current political situation we’re in.”

As well as the two-year wait, there are also changes to when various categories of taxpayer will be caught by MTD. Those with combined business and property turnover of more than £50,000 will be first to have to keep digital records and update HMRC every quarter.

TURNOVER

One year later, the rules will apply above £30,000 of turnover. For those with turnover below £30,000, a decision on when MTD should apply will be made in the next six months.

Mehta adds: “By 2025-26 the Government will have spent almost £900 million on building the MTD system, which is a measure of its commitment to the programme.

“Taxpayers and accountants now have longer until they’re forced into change by Government but this delay should not prevent them from pressing ahead.”