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When does Making Tax Digital come into effect?

Posted on 19 Nov 2018 - Making Tax Digital

April 2019

  • VAT registered businesses/organisations with a turnover over £85k.
  • From the beginning of the first VAT period after this date there will be a need to keep digital records and make VAT submissions via software. 

October 2019

HMRC has deferred for 6 months the adoption of MTD for VAT for the following:

  • Trusts
  • “Not for profit” organisations that are not set up as a company
  • VAT divisions and VAT groups
  • Certain public sector entities required to provide additional information on their VAT return
  • Local authorities and public corporations
  • Traders based overseas
  • Those required to make payments on account
  • Annual accounting scheme users

There will be a requirement to comply with MTD from the beginning of the first VAT period starting after 1st October 2019.

April 2020 (at the earliest)

  • For Income Tax (self-assessment) and Corporation Tax.
  • HMRC have said that this will only happen when MTD is working; a pilot for Income Tax is well underway.
  • Previously Income Tax was to start in April 2018 for businesses above the VAT threshold, but this has now been delayed until April 2020 at the earliest.

MTD timeline

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