Delays To Making Tax Digital for Income Tax Self-Assessment (ITSA)

The digitisation of income tax, known as Making Tax Digital, was originally intended to start in April 2023, but HMRC has announced that businesses will be given an extra year to prepare for the changes.

The delay will allow for HMRC to deliver a more robust service, and ensure that all UK businesses are adequately set up for digital tax assessments.

Making Tax Digital is the first step in the Government’s plan to become one of the most digitally advanced tax authorities in the world.

Financial Secretary to the Treasury, Lucy Frazer, said: “The digital tax system we are building will be more efficient, make it easier for customers to get tax right, and bring wider benefits in increased productivity. But we recognise that, as we emerge from the pandemic, it’s critical that everyone has enough time to prepare for the change, which is why we’re giving people an extra year to do so. We remain firmly committed to Making Tax Digital and building a tax system fit for the 21st century.”

Making Tax Digital for Income Tax Self-Assessment will now be required for all businesses with an income over £10,000 from April 2024.

General Partnerships will not be required to follow MTD for ITSA until the following financial year, April 2025.

Other partnerships will be required to join at a later date which has yet to be announced.

Eligible businesses and landlords will have the opportunity to sign up early to the MTD for ITSA pilot, giving access to the benefit of digital tax assessments from 2022.