UK MTD 2020: 3 major changes for 1.3 million businesses
- Nov 5, 2019 | Richard Asquith
First Published in Accountancy Age, 1 November 2019
On 1 April 2020, phase 2 of Making Tax Digital (MTD) for VAT starts with the ending of the UK’s HMRC’s ‘soft landing’ first phase. It is this second phase that will cause most issues. How are the three reforms going to affect almost 1.3 million VAT registered businesses in 2020?
Congratulations if you are one of the hundreds of thousands who successfully filed on the new HMRC MTD platform following its introduction in April this year. But that was the easy bit. Now it’s the end of the ‘soft-landing’ in April 2020, and time to prepare for the three major changes: digital bookkeeping, digital journey and, the clincher, penalties. It is this April 2020 phase that will cause the issues. How are the three reforms going to affect over one million VAT registered businesses in 2020? Any businesses which were deferred on the first wave of MTD until 1 October 2019 will also be deferred on the 2020 changes until 31 October 2020.