Is Your Business Ready for Making Tax Digital

Is Your Business Ready for Making Tax Digital

 

HMRC reason for implementing Making Tax Digital

 

HMRC are wanting to reduce the estimated £9 billion of tax lost to the treasury each year, as a result of carelessness and errors in calculating tax affairs. Moving forward, HMRC can review the detail behind the VAT submissions and can identify errors earlier.

 

Making Tax Digital will it impact my business?

 

If you are not already aware, HMRC is Making Tax Digital from April 2019, which is less than 12 months away. HMRC are currently piloting the scheme, which will go live from April 2019. Making tax digital is only for VAT at this time and other taxes such as self assessment and corporation tax have been pushed back to April 2020, at the earliest

 

Businesses may be misled in thinking that they currently file their VAT returns digitally using the HMRC online portal by inputting their calculated VAT figures. From April 2019, this will no longer be accepted by HMRC. All VAT registered businesses with turnover above the VAT threshold of £85,000 will have to submit their VAT returns using Making Tax Digital compliant software.

 

Exemptions from these changes are very limited, but businesses that are run by a practising member of a religious society or those with beliefs which are incompatible with using electronic communications will be exempt from using Making Tax Digital for VAT. Other potential exemptions are on the grounds of age, disability or remoteness of location.

 

Please  don’t be worried about these changes. Digital software can be positive for your business and can lead to efficiencies and provide you with regular financial information to assist you in running your business.

 

G+E can assist you with these upcoming changes by getting your business set up and compliant with the new regime. Please check now and if you do not know if your current record keeping or software is Making Tax Digital compliant, then please do not hesitate to contact us at hello@garbutt-elliott.co.uk.