Updated on 20 December 2022 to include threshold changes announced on 19 December 2022
The Treasury has announced that compulsory use of HMRC’s Making Tax Digital (MTD) scheme for Income Tax Self-Assessment will be delayed for two years to 2026, having already pushed the date back to 2024 because the technology was not ready. They have also substantially raised the minimum threshold from £10,000, representing a move that will protect authors, which we have been campaigning for since 2017.
Digitisation is a vital update to the UK tax system, however the Society of Authors welcomes this needed delay. Implementation of the programme in its recent form would have forced any freelancer with an annual income of over £10,000 to file quarterly updates to HMRC using new software which is yet to be piloted. This would have been an onerous administrative and financial burden to place on lower paid workers and would have led to numerous complications.
The new minimum threshold will be £50,000, effective from April 2026 and reducing to £30,000 from April 2027.
We sincerely hope that the government will take this time to continue to review the proposed changes, so that they do not make unreasonable demands of lower paid workers’ time and money, including scrapping the proposed quarterly returns, as the current system of a single, annual payment is perfectly adequate.