It’s hard to believe that it has been 10 years since George Osborne stood at the podium and announced the revolutionary idea of Making Tax Digital (MTD). Back in 2015, the promise was clear: a modern, streamlined tax system, less paperwork, and the end of the annual tax return. Oh, how naïve we were!
A whole decade later, where are we? Well, if you’ve been on this rollercoaster from the start, you’ll know it’s been a journey of delays, rebrands, and ever-changing deadlines. What started as a grand vision of effortless tax reporting has become, for many, a bureaucratic maze of software subscriptions, compliance headaches, and yet more deadlines to juggle.
The Original Dream
The idea behind MTD was simple: businesses and landlords would submit digital records quarterly, giving HMRC real-time data and, in theory, making tax simpler. We were told that by 2020, everyone would be on board and that this digital transformation would be the best thing to happen to tax since, well, tax itself.
Fast forward to today, and MTD for VAT is here (kind of), MTD for Income Tax is coming (maybe), and MTD for Corporation Tax is still a mystical concept floating in the distance. The timeline has been pushed back so many times that tax professionals now check MTD updates with the same enthusiasm as train delays on a rainy Monday morning.
The Reality Check
For small businesses, especially sole traders and landlords, the promise of simplicity has felt more like an extra layer of complexity.
- MTD for VAT? It arrived in 2019, but many businesses are still figuring it out.
- MTD for Income Tax (MTD ITSA)? Originally due in 2020, then 2023, now 2026… and who’s betting on another delay?
- MTD for Corporation Tax? Last seen lurking in HMRC’s long-term plans, possibly waiting for flying cars to become mainstream first.
And let’s not forget the real winners of MTD—accounting software providers. Gone are the days of a simple spreadsheet; now, businesses must navigate a world of mandatory digital tools, subscriptions, and system updates. No software? No compliance. No compliance? Hello, penalties.
Our systems have been in place for 10 years, much to our (and our clients’) expense. We’ve adapted, paid for new software, trained on ever-changing rules, and yet, we’re still waiting for HMRC to catch up with its own grand vision. Apparently, that vision is now here—having seen a glimpse of QuickBooks’ MTD product behind the scenes, perhaps the future is finally arriving… or at least, something resembling it.
The Future of MTD – More Delays or a Digital Utopia?
So, where will MTD be in another 10 years? Perhaps it will finally be fully operational. Perhaps AI will be filing our tax returns for us. Or perhaps we’ll still be reading another “MTD update” from HMRC, explaining why they need just a few more years to get it right.
In the meantime, if you’re a small business owner or a childcare professional trying to keep up with MTD, don’t panic. That’s my job. I’ll guide you through the ever-changing landscape, making sure you stay compliant (and sane) while HMRC figures out the finer details.
So, happy 10th anniversary to Making Tax Digital! Here’s to another decade of updates, extensions, and software subscriptions. Cheers!