ICAEW has responded to HMRC’s publication, Making Tax Digital for VAT: legislation overview, published on 13 September 2017. Our response is published as ICAEW REP 128/17.
We continue to be supportive of HMRC’s digital transformation, but this must not be rushed and we have yet to be convinced that MTD will reduce the administrative burden of VAT for business. Businesses and individuals should be encouraged to adopt digital reporting as a benefit to their business and not as a forced change. Many businesses will not realise that merely completing the nine boxes for a VAT submission on the GOV.UK website as they do now, will not be an acceptable submission for MTD from April 2019.
In our response, we raise a number of issues in relation to MTD for VAT, both for business and for HMRC. Its success will be an important element in directing the next steps in the development of the MTD programme, so we welcome the assurance from the Financial Secretary to the Treasury, Mel Stride, that income tax and corporation tax will not be mandated until it is clear that the programme has been shown to work well.
Our concerns include:
Our detailed comments in the representation expand on these and other important practical aspects of MTD for VAT.