Government Announces Delays to MTD ITSA

 

The Government has announced a further delay to the introduction of Making Tax Digital for Income Tax Self Assessment (MTD ITSA).

In a statement released on 19th December, the government has recognised that the transition to Making Tax Digital during this challenging economic environment represents a significant change for tax payers, their agents as well as HMRC. To maximise the benefit of this modernised system, they are giving a longer period to prepare with the mandatory use of software being phased in from April 2026 instead of April 2024. 💻

From April 2026, self-employed individuals and landlords with an income of more than £50,000 will be required to keep digital records and provide quarterly updates on their income and expenditure to HMRC through MTD-compatible software.

 
Those with an income of between £30,000 and £50,000 will need to do this from April 2027.
For other, smaller businesses under the £30,000 income threshold there will be a review to consider how it can be shaped to meet smaller businesses needs in addition to fulfilling their Income Tax obligations.

Another change is that the mandation for general partnerships will not be extended in 2025 unlike previously announced. The government remain committed to introducing MTD for ITSA to partnerships at a later date.

For more information check out- https://www.gov.uk/government/news/government-announces-phased-mandation-of-making-tax-digital-for-itsa

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