HMRC have recently updated their guidance note on penalties that apply during the voluntary sign-up phase for MTD for Income Tax Self-Assessment. The change (in the ‘summary of impacts’ section) adds the following note: ‘Where a ‘Time To Pay’ arrangement is made within 15 days of the payment due date it will prevent a late payment penalty, as long as the Time To Pay agreement is upheld by the taxpayer.’
From 6 April 2024, those who join MTD for ITSA on a voluntary basis will become subject to the new harmonised late-payment penalty and interest regime – with the first penalties ‘potentially’ applying for annual obligations due by 31 January 2026 (subject to the new points-based system which aims to penalise persistent failures rather than the occasional missed filing or payment deadline).
It is worth noting that the ‘detailed proposal’ section of the guidance note appears not to have been revised and still refers to legislation to be ‘introduced in Autumn Finance Bill 2023’. Regulations to activate the new penalty regime in relation to ‘eligible volunteers’ have already been made under the power given by FA 2024 s 37: the Finance Act 2021 (Income Tax and Capital Gains Tax) (Penalties) (Appointed Day: Eligible Volunteers) Regulations, SI 2024/440.
HMRC have recently updated their guidance note on penalties that apply during the voluntary sign-up phase for MTD for Income Tax Self-Assessment. The change (in the ‘summary of impacts’ section) adds the following note: ‘Where a ‘Time To Pay’ arrangement is made within 15 days of the payment due date it will prevent a late payment penalty, as long as the Time To Pay agreement is upheld by the taxpayer.’
From 6 April 2024, those who join MTD for ITSA on a voluntary basis will become subject to the new harmonised late-payment penalty and interest regime – with the first penalties ‘potentially’ applying for annual obligations due by 31 January 2026 (subject to the new points-based system which aims to penalise persistent failures rather than the occasional missed filing or payment deadline).
It is worth noting that the ‘detailed proposal’ section of the guidance note appears not to have been revised and still refers to legislation to be ‘introduced in Autumn Finance Bill 2023’. Regulations to activate the new penalty regime in relation to ‘eligible volunteers’ have already been made under the power given by FA 2024 s 37: the Finance Act 2021 (Income Tax and Capital Gains Tax) (Penalties) (Appointed Day: Eligible Volunteers) Regulations, SI 2024/440.
