Two years after George Osbourne’s announcement of the move to digital tax, there is still a lot of confusion about what Making Tax Digital actually means.
In this post, we’ll explain what Making Tax Digital will look like, once it’s complete, and what it will actually mean for you and your business.
When’s it going to happen?
Making Tax Digital (MTD) has been pushed back from its original roll-out date of 2017. The new timetable will start in 2019 and will only affect businesses that have a turnover above the VAT threshold, and then it will only be used to keep records VAT. All other businesses and taxes will not be asked to keep digital records for other taxes until at least 2020.
Why is it happening?
Making Tax Digital is at the heart of government plans to make taxation quick and simple.
As part of digital tax, you will have a personalised digital account where you’ll be able to access all of your information in one place, as well as a real-time view of your tax affairs.
What will I have to do?
If you already have an accountant doing your accounts and VAT returns, you won’t have to do much apart from providing the relevant information more often. If you don’t have an accountant handling your VAT return you will need to start preparing your information as soon as possible, as once MTD comes into force you will be expected to notify HMRC about your VAT quarterly rather than annually.
How can we help?
If you’re worried about MTD we can provide you with clear information and direction on how you can prepare for the new changes. We offer a free initial consultation for new clients, so to arrange a meeting with us please click here to find out how we can help.