Our comments in response to the consultation on Making Tax Digital for corporation tax.
HMRC published a consultation titled ‘Making Tax Digital: Corporation Tax’ on 12 November 2020 which set out proposals for expanding the Making Tax Digital (MTD) principles to corporation tax (CT) following the earlier roll out to VAT and planned introduction for income tax self-assessment (ITSA) from 2023. The basic fundamentals of MTD are that taxpayers are required to maintain digital accounting records and submit tax returns digitally. For CT and ITSA there will also be a new requirement to submit returns based on the accounting records on a quarterly basis. In our response to HMRC submitted on 5 March 2021, we recognised the benefits for businesses of digital record keeping but we raised a number of concerns about the detail of the current proposals, particularly for large complex businesses and those subject to sector specific accounting and/or tax regimes.
We recommended that, before imposing what could be considerable cost on businesses, HMRC carefully review the incremental benefits of expanding MTD for companies that are already complying with the digital record keeping requirements as a result of the VAT roll out. We also provided a number of suggestions on how the principles of MTD could be implemented for CT in a way that is less onerous and costly for business than proposed in the consultation document if HMRC decide to press ahead with these plans.
If you would like to discuss our response or any aspects of this consultation, please speak to your usual contact.
For further information please contact :
© 2021 KPMG LLP a UK limited liability partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.