Just before the recent election, Making Tax Digital was promptly shoved in a box and hidden under the rug with a note reading ‘To be opened April 2018’. Since then, it has tactically been ignored by every MP and not a single mention of it has yet been made in the Houses of Parliament.
Instead, we’ve been left guessing with the cryptic messages included within the Queen’s speech made just under a week ago on the 21st June.
Among everything else that was (and wasn’t) mentioned, the thing we’re curious about are the three new finance bills designed to implement budget decisions. So far, we’ve received a vague hinting at what the Summer Finance Bill 2017 will include, which are measures to pin-point and tackle tax avoidance. This itself might include the Making Tax Digital scheme.
Did the Queen’s Speech Kill MTD?
Unfortunately, no. Or at least not that we know of.
Like many other policies usually found in the Queen’s Speech, MTD has been announced missing but not dead. While the Summer Finance Bill has heavily hinted towards bring back Making Tax Digital, there is no confirmation that it will be going ahead. All we know is that it will be here in April 2018 and we need to be ready for it.
One of the biggest concerns from financial experts, is that HMRC won’t be ready for Making Tax Digital. As it stands, we have less than a year until this scheme comes into effect, yet we’ve heard no news about it.
HMRC also has a bad record with digital tax returns. Sole Traders and anyone else who fills out a Self-Assessment tax return online can already tell you that the online form includes incorrect information causing problems down the line. This encourages people to fill out paper returns instead, which defeats the point of having an online tax return service in the first place.
At this rate, we simply have to assume that MTD is going to happen whether we want it to or not, and at the rate it’s progressing (in other words, not at all) it’s looking like it’ll be a rushed scheme that won’t be ready upon release. This WILL create problems for all business owners, especially as you will be expected to complete 4 (minimum) tax returns a year.
Online accountancy software already exists, so it’s hard to see why we’ve heard nothing from HMRC or the government about this as the technology is obviously there. It would seem that with all the political turmoil that’s happened during the last month, it’s simply another policy that has been forgotten about.
With any luck, it will stay swept under the rug for good.
When will We Know More?
Now that Theresa May has (finally) made a deal with the DUP to create a minority government, we might actually hear something about all these policies that the Conservative party hid away. That could either be a good thing (no more MTD) or a bad thing (nevermind, it’s here to stay), we simply can’t say just yet.
For now, we should all just stick to what we know. Making Tax Digital is likely to go ahead in April 2018. If we’re going to hear anything new about it, it will likely be after parliament has voted on the Queen’s speech. If that is successful, we’ll probably hear about it when we’re given more detail about the Summer Finance Bill for 2017.
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