Last week the rumors were circulating that MTD for ITSA was to be postponed and this morning, 19 December, those rumors were confirmed in a written statement by the Financial Secretary to the Treasury.
For some time there have been calls from various professional bodies to delay the introduction, so the news won’t come as a surprise to many.
It has also been announced, that there will be a phased introduction to the scheme. The statement sets out the following points:
- A two-year delay until April 2026 for mandatory MTD ITSA filing.
- Minimum income reporting level increased to £50,000, with those earning more than £30,000 mandated to join the scheme in 2027.
- The position for landlords and sole traders earning less than £30,000 will be reviewed and a decision taken later on when they start filing via MTD.
- Points-based penalty system to be extended to MTD ITSA filers when they join.
Hopefully the extension will give HMRC time to address many of the key issues with the scheme which are currently still unresolved.