Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government how Making Tax Digital will reduce the tax gap attributable to rogue traders who intentionally evade tax.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
Quarterly updates required by Making Tax Digital (MTD) are not the same as tax returns. They are simple, unadjusted summaries of income and expenditure, acting as a snapshot of quarterly trading activity. They will be populated automatically through software and can be submitted easily. This process has been designed to be simple for users and quick to complete.
Quarterly updates will support taxpayers to get their tax right by ensuring timely and accurate record keeping, enabling tailored digital prompts and to view estimates of their emerging tax liability throughout the tax year, making it easier to submit their end of year return.
MTD is intended to address parts of the tax gap caused by unintentional taxpayer error and failure to take reasonable care. By preventing common taxpayer errors, MTD for income tax helps address the small business Tax Gap, adding £1.95bn to the public finances through to 2029/30.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government how increasing filing obligations through Making Tax Digital from one to five filings per year will reduce the tax gap.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
Quarterly updates required by Making Tax Digital (MTD) are not the same as tax returns. They are simple, unadjusted summaries of income and expenditure, acting as a snapshot of quarterly trading activity. They will be populated automatically through software and can be submitted easily. This process has been designed to be simple for users and quick to complete.
Quarterly updates will support taxpayers to get their tax right by ensuring timely and accurate record keeping, enabling tailored digital prompts and to view estimates of their emerging tax liability throughout the tax year, making it easier to submit their end of year return.
MTD is intended to address parts of the tax gap caused by unintentional taxpayer error and failure to take reasonable care. By preventing common taxpayer errors, MTD for income tax helps address the small business Tax Gap, adding £1.95bn to the public finances through to 2029/30.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government when they plan to publish detailed guidance about the interpretation of digital exclusion in the context of Making Tax Digital.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
A significant majority of self-employed individuals and landlords have turnover below the VAT threshold, which is currently £90,000. Since 2022, all VAT-registered businesses have been required to use Making Tax Digital (MTD) regardless of whether they are above of below the VAT threshold. The MTD for Income Tax threshold starts at £50,000 from April 2026, reducing to £30,000 in April 2027 and £20,000 in April 2028. This ensures MTD will extend the benefits of digitalisation to many more businesses, helping them to adopt new digital ways of working, improve productivity and growth and get their tax right. This helps address the tax gap for Income Tax Self-Assessment, which is estimated at £8.7bn in 2023-24 and is particularly prevalent amongst the smallest businesses. HMRC has worked extensively with customers, representative bodies and software developers to ensure that MTD works well for businesses of all sizes.
MTD Quarterly updates are not self-assessment tax returns. They are simple summaries of income and expenditure which can be automatically populated through digital records kept by MTD users. HMRC expects quarterly updates to be accurate based on the best available information at the time, but taxpayers do not have to make a declaration of accuracy when these are submitted, and there will not be penalties for inaccurate quarterly updates.
The Government recognises that not everyone is able to interact with HMRC digitally. Taxpayers who are digitally excluded from MTD for Income Tax will be able to apply for an exemption. HMRC will begin operating the exemption process in the coming weeks.
HMRC will publish detailed guidance when the exemption application process opens for digitally excluded taxpayers. This will explain how taxpayers, or someone acting on their behalf, can apply to be exempted from MTD for Income Tax. HMRC will also write to taxpayers to make them aware of the exemptions. There will also be engagement with business and taxpayer representatives to help disseminate this information.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether digitally excluded taxpayers will be able to apply for an exemption from Making Tax Digital before April 2026.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
A significant majority of self-employed individuals and landlords have turnover below the VAT threshold, which is currently £90,000. Since 2022, all VAT-registered businesses have been required to use Making Tax Digital (MTD) regardless of whether they are above of below the VAT threshold. The MTD for Income Tax threshold starts at £50,000 from April 2026, reducing to £30,000 in April 2027 and £20,000 in April 2028. This ensures MTD will extend the benefits of digitalisation to many more businesses, helping them to adopt new digital ways of working, improve productivity and growth and get their tax right. This helps address the tax gap for Income Tax Self-Assessment, which is estimated at £8.7bn in 2023-24 and is particularly prevalent amongst the smallest businesses. HMRC has worked extensively with customers, representative bodies and software developers to ensure that MTD works well for businesses of all sizes.
MTD Quarterly updates are not self-assessment tax returns. They are simple summaries of income and expenditure which can be automatically populated through digital records kept by MTD users. HMRC expects quarterly updates to be accurate based on the best available information at the time, but taxpayers do not have to make a declaration of accuracy when these are submitted, and there will not be penalties for inaccurate quarterly updates.
The Government recognises that not everyone is able to interact with HMRC digitally. Taxpayers who are digitally excluded from MTD for Income Tax will be able to apply for an exemption. HMRC will begin operating the exemption process in the coming weeks.
HMRC will publish detailed guidance when the exemption application process opens for digitally excluded taxpayers. This will explain how taxpayers, or someone acting on their behalf, can apply to be exempted from MTD for Income Tax. HMRC will also write to taxpayers to make them aware of the exemptions. There will also be engagement with business and taxpayer representatives to help disseminate this information.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government why the Making Tax Digital income threshold is different to the value added tax threshold.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
A significant majority of self-employed individuals and landlords have turnover below the VAT threshold, which is currently £90,000. Since 2022, all VAT-registered businesses have been required to use Making Tax Digital (MTD) regardless of whether they are above of below the VAT threshold. The MTD for Income Tax threshold starts at £50,000 from April 2026, reducing to £30,000 in April 2027 and £20,000 in April 2028. This ensures MTD will extend the benefits of digitalisation to many more businesses, helping them to adopt new digital ways of working, improve productivity and growth and get their tax right. This helps address the tax gap for Income Tax Self-Assessment, which is estimated at £8.7bn in 2023-24 and is particularly prevalent amongst the smallest businesses. HMRC has worked extensively with customers, representative bodies and software developers to ensure that MTD works well for businesses of all sizes.
MTD Quarterly updates are not self-assessment tax returns. They are simple summaries of income and expenditure which can be automatically populated through digital records kept by MTD users. HMRC expects quarterly updates to be accurate based on the best available information at the time, but taxpayers do not have to make a declaration of accuracy when these are submitted, and there will not be penalties for inaccurate quarterly updates.
The Government recognises that not everyone is able to interact with HMRC digitally. Taxpayers who are digitally excluded from MTD for Income Tax will be able to apply for an exemption. HMRC will begin operating the exemption process in the coming weeks.
HMRC will publish detailed guidance when the exemption application process opens for digitally excluded taxpayers. This will explain how taxpayers, or someone acting on their behalf, can apply to be exempted from MTD for Income Tax. HMRC will also write to taxpayers to make them aware of the exemptions. There will also be engagement with business and taxpayer representatives to help disseminate this information.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they plan to issue fines and penalties for inaccurate quarterly Making Tax Digital returns.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
A significant majority of self-employed individuals and landlords have turnover below the VAT threshold, which is currently £90,000. Since 2022, all VAT-registered businesses have been required to use Making Tax Digital (MTD) regardless of whether they are above of below the VAT threshold. The MTD for Income Tax threshold starts at £50,000 from April 2026, reducing to £30,000 in April 2027 and £20,000 in April 2028. This ensures MTD will extend the benefits of digitalisation to many more businesses, helping them to adopt new digital ways of working, improve productivity and growth and get their tax right. This helps address the tax gap for Income Tax Self-Assessment, which is estimated at £8.7bn in 2023-24 and is particularly prevalent amongst the smallest businesses. HMRC has worked extensively with customers, representative bodies and software developers to ensure that MTD works well for businesses of all sizes.
MTD Quarterly updates are not self-assessment tax returns. They are simple summaries of income and expenditure which can be automatically populated through digital records kept by MTD users. HMRC expects quarterly updates to be accurate based on the best available information at the time, but taxpayers do not have to make a declaration of accuracy when these are submitted, and there will not be penalties for inaccurate quarterly updates.
The Government recognises that not everyone is able to interact with HMRC digitally. Taxpayers who are digitally excluded from MTD for Income Tax will be able to apply for an exemption. HMRC will begin operating the exemption process in the coming weeks.
HMRC will publish detailed guidance when the exemption application process opens for digitally excluded taxpayers. This will explain how taxpayers, or someone acting on their behalf, can apply to be exempted from MTD for Income Tax. HMRC will also write to taxpayers to make them aware of the exemptions. There will also be engagement with business and taxpayer representatives to help disseminate this information.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask His Majesty's Government what assessment they have made of the quality of pre-application advice, and what steps they are taking to ensure the quality of pre-application advice.
Answered by Baroness Taylor of Stevenage - Baroness in Waiting (HM Household) (Whip)
The government strongly encourages local planning authorities to utilise best practice guidance for pre-application engagement and Planning Performance Agreements published by the Planning Advisory Service. This is available here. Most local planning authorities will offer some form of pre-application advice service, but we have no plans to make this a mandatory function.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask His Majesty's Government what plans they have, if any, to make pre-application advice a compulsory service offered by local planning authorities.
Answered by Baroness Taylor of Stevenage - Baroness in Waiting (HM Household) (Whip)
The government strongly encourages local planning authorities to utilise best practice guidance for pre-application engagement and Planning Performance Agreements published by the Planning Advisory Service. This is available here. Most local planning authorities will offer some form of pre-application advice service, but we have no plans to make this a mandatory function.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask His Majesty's Government what steps they are taking to encourage the sympathetic conversion of historic buildings into new homes to support their housing targets.
Answered by Baroness Taylor of Stevenage - Baroness in Waiting (HM Household) (Whip)
The National Planning Policy Framework is already supportive of bringing heritage assets back into use, putting them to viable uses consistent with their conservation. We will continue to consider this matter as we develop our approach to heritage policy including through the creation of a suite of national policies related to decision making.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask His Majesty's Government what assessment they have made of the use of National Listed Building Consent Orders for alterations such as (1) secondary glazing, (2) roof re-tiling, including full strip and re-tile, and (3) any other routine works.
Answered by Baroness Taylor of Stevenage - Baroness in Waiting (HM Household) (Whip)
Listed Building Consent Orders are a useful mechanism to allow for streamlining in the decision making process for regular works unlikely to cause harm to heritage assets. We are aware of examples across the country where local authorities have introduced these, including for secondary glazing and other routine works. A national listed building consent order has not yet been introduced.