Going Digital? 5 things you need to know about Making Tax digital
It’s no secret that in order to make things easier things need to be digital, and this year we can add tax to the ever growing list. It’s one of the most fundamental changes to the UK tax system since the introduction of self-assessment. Here Peter Brown, Accounts Technician with Whiting & Partners gives us the top 5 things you need to know about making tax digital (MTD).
From April 2019, VAT registered businesses with a turnover of over £85,000 will be required to keep records using software approved by HMRC.
MTD has already begun
You may have noticed you already have access to your digital account with HMRC. The consultation period has ended and MTD is scheduled to go ‘live’ in April 2019 for those businesses effected, eventually widening the scope to personal tax in April 2020.
No more annual tax returns
The purpose of the new process is to make reporting financial information to HMRC more efficient. This means the end of the annual personal tax return as we know it. Instead, you will send information digitally to HMRC four times a year via your online account.
You can view your tax in real-time
Another benefit of MTD is that you can see your business’s tax position live. This helps monitor how much tax you owe before the end of the year and assists with errors that may arise throughout the year.
You must use HMRC approved/compatible software
HMRC have a list of approved digital software providers, including cloud and bridging software programmes which can link data in excel spreadsheets into your digital account for filing to HMRC.
There’s still time to act
Many businesses are still yet to act. With just a few weeks to go there’s still time to get your business accounts onto a preferred software platform in time for the deadline.
If you want more information on this, you can go to Whiting & Partner’s breakfast seminar on Making Tax Digital on Tuesday 26 February at Ashlar House, Bury St Edmunds, and Wednesday 27 February at Huntingdon Racecourse where our MTD and software experts will be on-hand to provide you with the basics of MTD and what your business needs to do to comply.
Visit our website to book your place or call Victoria Stokes on 01284 752313.