In this month’s update, we highlight key dates, tax legislation changes, and updates from HMRC.
The reform to VAT penalties, and interest for late filing and payment, were due to take effect in April of this year but will now be delayed to 2023 to provide HMRC more time to update its IT systems. In the meantime, the existing rules will continue.
From April this year, VAT-registered businesses with a taxable turnover below the VAT threshold of £85,000 will be required to follow the Making Tax Digital rules. Previously, organisations under the threshold could register voluntarily but from 1st April 2022 MTD for Value Added Tax (VAT) will be mandatory for all VAT-registered businesses.
MTD is part of the overall digitalisation of UK Tax and requires organisations to:
keep digital records starting from 1st April 2022 or the beginning of their VAT period
sign up and submit their VAT Return through Making Tax Digital
From 6th April 2024, landlords and self-employed businesses with annual property or business income above £10,000 will need to follow the rules for Making Tax Digital for Income Tax.
Further information on Making Tax Digital:
Not sure what you need to do, contact our MTD Expert, Michael Lowe on 01858 565142.
The reduced VAT rate on certain products and services ends this year and returns to the standard VAT rate as of 1st April 2022. The change applies to:
hospitality
hotel and holiday accommodation
admissions to certain attractions
The Finance Bill has completed its passage through the House of Commons: it is now in the House of Lords on its second reading. The Government proposed amendments to the Bill, which were agreed and added, including the Residential Property Developer Tax (RPDT), the Qualifying Asset Holding Company (QAHC) regime and basis period reform. Changes also included new schedules for Freeport Tax Site reliefs and the new Public Interest Business Protection tax.
A slew of tax changes will come into effect in April 2022, here’s a helpful overview from the Chartered Institute of Tax.
To read HMRC’s Notice updates, visit: https://www.gov.uk/topic/business-tax/vat
To discuss the updates, contact our team of VAT experts, who are available to answer your questions and support you with implementing any changes following updates in VAT legislation and case law.
Call us: 01858 565142
Email us: jhurst@vatangles.com
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