MTD extension for VAT is coming and how to join the MTD income tax pilot

2022 is another big year for Making Tax Digital (“MTD”) with the extension of MTD for VAT to all VAT registered businesses from 1 April 2022. HMRC started the year off with a Press Release asking if businesses are ready and providing advice on the steps needed to prepare. Businesses and taxpayers may also be able to sign up for the MTD for income tax (which commences for the self-employed and landlords from 1 April 2024) pilot via their software provider. The option to sign up directly via GOV.UK has recently been removed as a roadmap for the pilot is expected to be published in Spring.

HMRC has asked us to share the below update on the MTD for income tax pilot which has been recently provided to software developers:

“As we progress the MTD ITSA pilot it is important that we manage it in a controlled way so that we can test and expand effectively. So, from 9 December, customers will only be able to sign up for the MTD ITSA pilot through their software provider (in essence how it is currently happening). As we expand the pilot, this will enable HMRC and developers to ensure that all customers entering the pilot (and their agents where applicable) receive the support and guidance that they need.

Customers who are already participating in the pilot can continue to do so. HMRC will be sharing more detail in early 2022 including the pilot outline plan, which will include a roadmap identifying when various customer types will be eligible to join MTD ITSA. MTD also continues to work on the customer support model to support more customers coming into the service from April 2022.”

Relevant publications on GOV.UK are as follows:-

• Sign up as an individual for Making Tax Digital for Income Tax; and
• Sign up your client for Making Tax Digital for Income Tax.

The Institute continues to discuss MTD with HMRC and will update members in Chartered Accountants Tax News.