Points don't make prizes!
As of 1st April 2022, HM Revenue & Customs will implement a new points-based penalty regime, applicable to Making Tax Digital (MTD) VAT and MTD Income Tax Self Assessment (ITSA). The purpose of this new system, is to ensure penalties are made simple, fair and effective.
The taxpayers will receive a point every time they miss a submission deadline. HMRC will notify them of each point. At a certain threshold of points, a financial penalty of £200 will be charged and the taxpayer will be notified. The threshold is determined by how often a taxpayer is required to make their submission.
Further information on the points system and thresholds can be found here.
What is MTD?
Making Tax Digital (“MTD”) is an initiative from HMRC, aimed at making the UK’s tax system one of the most advanced digital tax administrations in the world.
It ensures businesses maintain digital tax records and file all of their returns online - giving HMRC access to near real-time data, while giving businesses better visibility of what tax they owe throughout the year.
If you're in need of help to ensure you're MTD compliant, our team of accountants are here to help. Get in touch today on (01666) 335 000 or at firstname.lastname@example.org to find out how we can support you.