With autumn in the air, our team of accountants continue to help owners of VAT-registered businesses make the transition towards digital accounts.
That’s because, subject to any further delay, all businesses with annual taxable turnover of more than £85,000 will need to embrace the first phase of Making Tax Digital (MTD) from 1 April 2019.
If you own one of the UK’s 2.67 million VAT-registered businesses, you will have to submit tax information – such as revenue and expenses – every 3 months as well as an annual tax return.
The biggest question left to answer at this stage surrounds the software that initially needs to be approved by HMRC and then used to submit digital accounts from next spring.
Who else does Making Tax Digital apply to?
Businesses below the VAT-registration threshold of £85,000 can volunteer to make quarterly submissions from 1 April 2019 if owners feel ready to do so.
Assuming the rollout of MTD for VAT-registered businesses goes off without a hitch, small businesses may follow suit from 1 April 2020 although this is not set in stone.
Individuals with a secondary income or gain of more than £10,000 are expected to be in the final phase of the rollout, after it was put on hold in May 2018 to free up resources for Brexit.
Eventually, MTD will be used to report all income tax outside of PAYE, corporation tax and VAT.
What software will be used for Making Tax Digital?
At the time of writing, there are 45 software suppliers that have received HMRC’s seal of approval with many more providers to follow.
Xero, Sage and QuickBooks are partners of ours, and the experience we have gained working with them has helped local businesses move towards the cloud well before MTD is rolled out.
Our digital experts also use these pieces of software as part of their daily jobs, which makes us ideally placed to advise you on what you need to do and how to go about it.
Still reluctant to embrace Making Tax Digital?
If you’re not tech-savvy and prefer using spreadsheets to keep accurate records, you will eventually need to purchase software that interacts with HMRC’s systems.
This seems likely to be in the form of a third-party application programming interface, more commonly known as an API, but the devil in the detail has yet to be confirmed.
The other option to consider if this all seems too daunting is that you can email your spreadsheet to us and let our team import your information to be submitted digitally on your behalf when the time comes.
Get in touch
From providing training to outsourcing your digital accounts to us, our team of digital specialists can talk you through all your options when it comes to MTD.
Contact us on firstname.lastname@example.org or call 01363 773191 for more information.