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<p>The Government understands that some people with disabilities, those in rural locations
with poor broadband services, and those who are digitally excluded for other reasons
may find it more difficult to comply with Making Tax Digital (MTD) requirements. MTD
exemptions have operated successfully since the introduction of MTD for VAT in April
2019 for businesses with taxable turnover in excess of the VAT threshold. These exemptions
will continue to be available to businesses within the expanded scope of MTD.</p><p>
</p><p>There will be no specific allowances or payment made to those using MTD for
time spent complying with MTD requirements. However, the Government accepts that there
will be time spent in familiarisation with the new MTD obligations (digital record
keeping and quarterly submission of information). The Lloyds Bank UK Consumer Digital
Index 2019 found that those who are the most digitally engaged save a day a week in
administration by going digital. Once businesses are used to operating the new MTD
processes, the Government anticipates that they will find that MTD makes it easier
for them to get things right, reducing errors and saving time in administering their
tax affairs.</p><p> </p><p>MTD is not a response to any changes in HMRC workforce.
It is a key part of the Government’s long term goal for HMRC to become one of the
most digitally advanced tax authorities in the world, and forms part of the Government's
10-year strategy to build a trusted, modern tax administration system. As well as
helping to tackle the part of the tax gap arising due to error and failure to take
reasonable care, MTD will help to make the tax administration system more resilient
and effective in responding to future shocks, while also providing businesses with
access to real-time data and a more accurate overview of their financial position.</p><p>
</p><p>The Government will not be funding specialist software or training, but will
continue to work to ensure that any additional costs to business are minimised. Free
Income Tax software will be available for businesses with the simplest tax affairs.
For VAT, there are already over a dozen free packages available as part of a highly
competitive market with over 500 products for different business needs. On training,
the HMRC customer support model includes a multi-layered approach stretching across
agents, third party software support, through to telephony support, webchat, and HMRC’s
Extra Support service, as well as signposting to information and guides and to local
or third party providers of digital skills courses or support already offered by external
providers.</p><p> </p><p>For those with slow speeds and no access to other commercial
alternatives, the broadband Universal Service Obligation (USO) came into force in
March 2020. The USO gives people in the UK the right to request a decent and affordable
broadband connection. The Government has pledged £5 billion to support the rollout
of gigabit-capable networks to the hardest to reach 20% of the country.</p>
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