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VAT registered businesses with a taxable turnover above the VAT threshold (£85,000) will be mandated to keep digital VAT records and send returns using Making Tax Digital (MTD) compatible software from April 2019.

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Following last year’s ministerial announcementMTD will not be mandated for other taxes until at least April 2020, but businesses can get involved in the Income Tax pilot now on a voluntary basis.

MTD for VAT– this is currently a private pilot available to invited volunteer VAT businesses and their agents. This is so HMRC can work with software providers, testing their systems and products on a small scale before opening it out to a wider audience. For now, they are limiting the number and types of business invited into the pilot. This explained in more detail in the stakeholder communications pack.

MTD for Income Tax – this pilot is already available for the self-employed with income from one source of self-employment and landlords (except those with furnished holiday lettings). Stakeholders will be able to use the material in this pack for any communications activity promoting the MTD for Income Tax pilot. You can read more about getting involved in the Income Tax pilot here.

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