UK digital income tax plans delayed

ACCA welcomes HMRC’s two-year pause

The UK Government has announced that the planned extension to Making Tax Digital for Income Tax Self-Assessment (MTD ITSA) will not now go ahead and will be postponed to April 2026.

Accountancy body ACCA warmly welcomed the government’s announcement, having called on the new Prime Minister and Chancellor to delay the extension to help relieve pressure on smaller firms. While ACCA supports the transition to digital the resources aren’t in place to successfully make the change at this time.

Commenting on the news, Glenn Collins, Head of Technical and Strategic Engagement, says: ‘Service standards at HMRC have fallen to an unacceptably low level, damaging relationships between HMRC, compliant taxpayers and the agents supporting them. This pause will help relieve the pressure, both on smaller firms as well as freeing up time within HMRC to focus on the restoration of acceptable service standards, and ensuring compliance by tackling bulk abusers of the tax system.’

‘In addition, we had serious concerns about the government’s communication of this large-scale change. Pausing implementation will give HMRC time to reconsider how best to raise awareness about this major change in the tax system, expected to affect millions of taxpayers, many of whom are small business owners struggling in a cost-of-business crisis.’

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