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What is ‘Making Tax Digital’?
Making Tax Digital is the process of using cloud-based software to complete all your tax affairs.
Making Tax Digital is a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their activities.
HMRC aims to become one of the most digitally advanced tax administrations in the world. Making Tax Digital is making essential changes to the way the tax system works, transforming tax administration so that it is:
The first stage of the government scheme ‘Making Tax Digital’ will start from 1 April 2019. Now is the perfect time to think about how this might affect your business.
HMRC are introducing the Making Tax Digital scheme from 1 April 2019, where businesses will have to submit their VAT returns electronically.
How will I be affected?
If you are a VAT registered business/individual, you will need to start using a Making Tax Digital Approved software for your first VAT return that starts after 1 April 2019. Therefore, if you VAT returns are filed for the quarters ending Feb/May/Aug/Nov, your first Making Tax Digital VAT return will be quarter ending 31 August 2018, as this is the first one to start after the transfer date.
How can I prepare?
HMRC are advising businesses to start using a Making Tax Digital Approved software by 1 January 2019, because you will then be ready at least one VAT return before the transition.
Businesses will need to keep and maintain their books and records digitally and submit VAT information to HMRC every quarter electronically. This might mean changing the way you record transactions or looking into new software packages to help keep things simple.
What Making Tax Digital Approved Software is available?
For some businesses, the transition to Making Tax Digital will be straightforward. For others, you might want a bit of help and advice. There are wide ranges of software options available on the market, with large providers offering a package that have been developed specifically for this purpose.
The main providers of a Making Tax Digital Approved software are:
Please note Excel is not a Making Tax Digital Approved software and cannot be used to prepare your VAT returns, from 1 April 2019 onwards.
There is other approved software available, please see HMRC’s website (link below) for the full list.
How we can help:
At Crowther Chartered Accountants, we can help you every step of the way when it comes to the transfer to Making Tax Digital. Our friendly, professional staff are here to answer your questions and queries regarding every aspect of your VAT returns.
Our in-house bookkeepers are experienced using a variety of different software packages. If you are having trouble deciding which software will best suit your business, please speak to one of the members of staff and they will be happy to help you will this decision.
We can also provide help for you to get up to speed with some training, either at our Huddersfield office or at your own premises.
See this article advice on if a business is not prepared by Accountancy Age https://bit.ly/2K7AVA0
As Making Tax Digital is introduced, we will be sure to keep you updated with any changes to the scheme, and how you might be affected. If you have any questions about income tax (either PAYE or self-assessment), VAT or about the accountancy services on offer here at Crowther Chartered Accountants, please feel free to get in touch. You can call the office on 01484 515544 or email firstname.lastname@example.org.