An update on Making Tax Digital
Making tax digital was originally planned to start in April 2018 for businesses with a turnover above £85k a year and from April 2019 those over £10,000. These plans have now changed, but does it mean businesses are off the hook?
It’s been proposed that MTD (Making Tax Digital) will come into effect from April 2019 for all VAT registered businesses. Some think that as they already produce returns, they will meet the requirements already however this may not be the case and key considerations are outlined below:
- Records will have to be kept digitally. This means no manual records. Therefore, if you currently use traditional ledgers and cashbooks then you will have to move to either a computerised piece of software or spreadsheets.
- VAT returns must be calculated on digital software and uploaded to HMRC. You will not be able to up load VAT returns via the current government gateway portal. Only 12% of VAT returns are actually submitted direct from software to HMRC. If you use spreadsheets for bookkeeping and then prepare the VAT return via the government gateway you will need to purchase some software to enable you to file the VAT return direct to HMRC
April 2019 seems a long time off, but it will soon be here and with a huge amount of businesses being affected by MTD , getting help and assistance at the last minute may be hard. We therefore recommend that businesses that will be affected from April 2019 should get plans in place to move to a computerised system, including being trained on the software and being confident the figures are accurate.
We have put systems in place to allow information from front of office systems to be integrated into QuickBooks Online.
At Moore and Smalley we are aware some businesses just don’t have time to implement a new system, and we can help you seamlessly move across to a cloud based product. We can help with day to day bookkeeping or just help at the year end, and anything in between.
If you have any questions or would like to speak to us about making tax digital, or if you would like to attend one of our free demonstrations of the cloud based software, QuickBooks Online, please contact Judith Dugdale or call on 01772 821021 to be put in contact with a member of our QuickBooks support team.