Some aspects of the MTD initiative have been deferred, but some are already in place, writes Tony Margaritelli
The accountancy profession as a whole has been fixating with some justification on the Making Tax Digital regime proposed by HMRC back in December 2015, which some of you may remember led to the lurid headline ‘The death of the tax return’.
Now we have been advised that, apart from VAT reporting, the bulk of the MTD provisions have been pushed back to April 2020, and decisions on the level of exemptions and consultations regarding corporate bodies will be delivered much nearer 2020 than 2017.
So, many practising accountants have breathed a sigh of relief while at the same time there has been much wailing and gnashing of teeth from the software developers, coupled with feverish sales and profit forecast re-modelling.
But one aspect of the digital agenda that is firmly under way and which is relevant to every individual rather than to every business, and which has received very little publicity, is that EVERY taxpayer already has a Personal Tax Account set up for them by HMRC.
Yes, every taxpayer has a Personal Tax Account ready and waiting to be used; all that is required is for the taxpayer to register to use their tax account. This can be achieved by going to www.gov.uk /personal-tax-account (a simple Google search will get you there).
The registering process is very simple and you should be up and running in no time, and there are even HMRC videos to help you available on YouTube. In December 2016, seven million users had registered and as at today registered users are in the order of nine million – still a long way to go but not a bad number when you consider how little publicity has been given to the subject.
You can access your Personal Tax Account from your desktop or laptop computer, your tablet or your smartphone so you can as they say make changes ‘on the go’.
So what can you do with your Personal Tax Account? Well quite a lot actually, not least of which is that it is digital and so there is no need for phone calls – which we all know are not HMRC’s strongest point –and certainly no need for something as archaic as a letter. From within your account you can liaise with HMRC, check the address they hold for you and amend as necessary; you’ll be able to see the tax code that is being provided to your employer or if you have multiple employments to each one. You will be able to see an estimate of the tax you are likely to pay for current year AND the next year, and see how your tax has been worked out.
You can use the account to claim a tax refund that is due you and have it paid directly into your bank account – this happens in about five days, as opposed to waiting upwards of six weeks for a cheque for the same refund.
You can get estimates for your state pension and you can track your National Insurance records to ensure that there are no incorrect gaps. Your Personal Tax Account is where you can apply for the Marriage Allowance and it will help you keep on top of any Child Benefit entitlement you may have. And if you or your partner are high earners, here is where you can opt out so as not to incur the High Income Child Benefit Charge.
The self-employed get a whole raft of options made available including filing returns, checking tax calculations, appealing penalties and telling HMRC that you have ceased to be self-employed.
So you see MTD is not all about business, and the part that relates to the individual is far less contentious than the proposals for companies. So if you haven’t already joined HMRC’s digital revolution, sign up for your Personal Tax Account now.
- Tony Margaritelli is Chair of the ICPA, an independent organisation representing accountants in practice. See www.icpa.org.uk for more