MTD update - Treasury reveals expansion of digital reporting scheme in 2022-23

3rd August 2020

Just a fortnight after a summer statement Chancellor Rishi Sunak insisted wasn’t a ‘mini-Budget’, the Government has slipped out a raft of policy statements – including big news about Making Tax Digital (MTD). The new measures were published on 21 July 2020, the eve of parliamentary recess, bundled up in the draft legislation supporting the Finance Bill 2020-21.

Since April 2019, VAT-registered traders with annual taxable turnover above £85,000 have been submitting VAT returns through MTD. The Treasury has now announced this is set to expand to all VAT-registered businesses from April 2022, and from April 2023, the Treasury expects MTD to cover all unincorporated businesses and landlords turning over more than £10,000.

This new urgency has been driven by the difficulty of implementing support measures for business during COVID-19 without comprehensive data.
Jessie Norman, Financial Secretary to the Treasury, said in a written statement: “The COVID-19 pandemic has also highlighted the need for a more flexible, resilient and responsive tax system that provides businesses and HMRC with more up-to-date information on businesses and their finances, and enables easier identification and better targeting of taxpayer support.”

You can read more about these measures in the attached bulletin.