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What are the Public Accounts Committee recommendations for MTD?

24 Nov 2023

As more of us digest the Chancellor’s Autumn Statement, experts from both the public and private sectors have poured over its contents. 20:20 Innovation discusses the key takeaways from the Autumn Statement in an article we published for both members and non-members.

We've also had a bundle of long-awaited news about Making Tax Digital (MTD). This stems from the Autumn Statement on Wednesday and the Public Accounts Committee (PAC) report on 24th November 2023. The latter refers to it being 'unacceptable' that after 7 years, with £640m of taxpayer money spent, so many questions remain about how the MTD for income tax regime will work.

This article, written by Sharon Cooke, looks at the key takeaways from the PAC report. Read on for more information about the report and what it means for MTD.

If you would like more information about joining 20:20 Innovation why not book a free 30-minute demo with our team today.

How do people feel about MTD?

Having run two webinars on the Autumn Statement already, I'd say the mood towards MTD for income tax has not improved. HMRC have just not gone far enough with the measures announced this week. This includes convincing the agent community that MTD will lessen the tax gap to the extent believed by HMRC.

Accountant moves from paper to making tax digital

Billie Mcloughlin ACCA has written a blog on the Autumn Statement news around MTD simplifications. The government now has until 24 January to respond to the PAC recommendations made, which include:

  • Holding senior leaders within HMRC accountable for delivering against the programme’s timetable and budget. The department must also demonstrate that the timetable and budget for implementation are now realistic.
  • HMRC should by April 2024 be able to explain how each of the identified design issues have been resolved. By summer 2024, HMRC should publish a robust assessment of the difference in tax revenue through (i) more frequent (quarterly) submissions of data and (ii) doing so digitally.
  • HMRC needs to be more aware of the realities facing business taxpayers and their agents. The department should seek customer views on this.
  • To try to rectify a lack of transparency about the cost to taxpayers, before rolling out MTD to those with lower incomes, HMRC should fully reassess the costs of compliance and prepare a robust business case.
  • Delays to date risk deterring software providers from developing quality products. By 24 February 2024, HMRC should set out how it will ensure that it strikes the right balance between ensuring competition, quality and access to software for its customers.
  • If further changes to the delivery timetable are needed, these must be communicated clearly, early and definitively. Providing certainty to customers is key.

Whether this list is any more realistic than my Christmas list to Santa I don't know. It feels like we've been here before, many times since the original 2015 announcement.

And then we've got a likely general election in 2024, which could change the roadmap again.

More support on MTD

If your accountancy business needs more support and training on MTD then why not get in touch with 20:20 Innovation?

If you would like more information about joining 20:20 Innovation, book a free 30-minute demo with our team today or call us on +44 (0) 121 314 2020.

Written by Sharon Cooke

Sharon Cooke

Sharon is a well-known speaker and consultant within the accountancy profession. Sharon is a Chartered Accountant and a Chartered Tax Advisor and speaks on all technical… Read more

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