Businesses, investors and workers across the UK face a challenging time ahead, as the Government continues to implement its Making Tax Digital initiative.
This landmark change in the recording and reporting of tax will gradually see the major components of taxation taken online, using the latest HM Revenue & Customs-compliant software, apps and programs.
Taxpayers must be fully prepared for these changes, as they could face fines of penalties if they do not comply in future.
Already, many businesses have had to comply with rules for VAT, which have become mandatory and subject to penalty for VAT-registered businesses above the £85,000 threshold.
The next big step in Making Tax Digital in April 2023 will target Income Tax for the self-employed and partnerships, as well as property income from some landlords and investors.
This will be followed by the introduction of new digital tax systems for Corporation Tax, which will affect every limited company in the UK.
Below are the key dates for Making Tax Digital to help you track your journey and ensure you are compliant with the changes ahead.
While the deadlines for the various stages of Making Tax Digital may seem some way off, the changes required to comply with this new tax system are complex and onerous.
Businesses and taxpayers may need to invest in new technology, such as cloud accounting software, and alter their method of recording and reporting accounts and tax information.
This modern, innovative method of accounting brings with it many benefits beyond just compliance with Making Tax Digital, including:
- Secure, limitless storage – Store years and years of invoices and receipts in the cloud securely.
- Reeady to use anytime, anywhere – Reconcile banking, send invoices, create expense claims and much more – anywhere, anytime.
- Real-time collaboration – The cloud allows you to work in real-time with other members of your team and your advisers.
- Quicker payments – Cloud packages also allow you to send invoices to your customers via email, track when they have been opened and even automate credit control.
- Additional support – There is a wide range of apps that run with and alongside many of the core software packages that make running a business fair simpler and less stressful.
We have already helped a wide range of businesses with the initial stages of Making Tax Digital and can assist you by putting the necessary software, apps and procedures in place.
To arrange an initial Making Tax Digital consultation with our team, please contact us.