HM Revenue and Customs (HMRC) has announced that all businesses will be given an extra year to prepare for the digitalisation of income tax.
The announcement follows stakeholder feedback, and HMRC has recognised the challenges faced by many UK businesses as the country emerges from the pandemic. The government will now introduce Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) a year later than originally planned and will now begin in tax year April 2024.
The scheme will not affect any NFRN members who are limited companies, but NFRN welcomes this delay as it allows businesses more time to prepare for the changes, and for HMRC to iron out any teething issues with the scheme.
The Making Tax Digital scheme is the first phase towards HMRC’s digital tax service. The plan is proposed to support businesses through their digitalisation journey and provides a digital service that many have come to expect in their everyday lives.