05 03 2018

UK Tables Regulations For Making Tax Digital Initiative

The UK Government has released The Value Added Tax (Amendment) Regulations 2018, which were tabled in the House of Commons on February 28, 2018, to provide for the introduction of new digital tax administration obligations for value-added tax registered persons in the UK, stemming from the Government's Making Tax Digital (MTD) project.

Under MTD, from April 1, 2019, businesses with a turnover above the VAT threshold (currently GBP85,000, or about USD117,000) will have to: keep their records digitally (for VAT purposes only), and provide their VAT return information to HM Revenue and Customs (HMRC) through MTD-compatible software. MTD will be available on a voluntary basis to other businesses, for both VAT and income tax.

The second draft of Finance Bill 2017, published on September 8, 2017, included legislation allowing for the introduction of Making Tax Digital for VAT. This primary legislation gave HMRC the powers to introduce regulations for the regime in December 2017, which set out the detailed requirements that businesses will have to meet – The Value Added Tax (Amendment) Regulations 2018. These Regulations have now been tabled and forwarded to parliament for its approval. It has also previously released a draft VAT notice on what Making Tax Digital for tax-registered persons will involve.