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You are here: Home » Latest News » Making Tax Digital will require businesses to use “designated software packages”

Making Tax Digital will require businesses to use “designated software packages”


The Financial Secretary to the Treasury, David Gauke MP, has confirmed in a letter to the Treasury Select Committee that HM Revenue & Customs plans to require businesses to make quarterly tax returns using “designated software packages” as part of its Making Tax Digital (MTD) initiative.

Previously, it was understood that businesses would be able to use their own choice of software package for their tax returns and this could include MS Excel.

The chair of the committee, Andrew Tyrie MP, wrote to the Financial Secretary in April to express concerns about the cost implications of the move for small businesses, many of which will not have the relevant systems in place.

The chair’s letter cited Institute of Chartered Accountants in England and Wales research suggesting that “75 per cent of all businesses, and 82 per cent of sole traders, would need to change their record keeping systems to comply with the government’s new proposals for Making Tax Digital.”

The changes are expected to be phased in by 2020.

Link: Gauke confirms ‘prescribed’ format for moving to digital tax accounts

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