Making Tax Digital

For the last few years HMRC have been hinting that there will soon be a tax reform dubbed "Making Tax Digital".  Quite what form this would take and what would be required of businesses and individuals was unknown until February 2018 where HMRC finally confirmed what Making Tax Digital will be and when it will take effect from.

 

At present MTD (Making Tax Digital) will be effecting VAT registered businesses only, however the suggestion will be that within the next few years all businesses and individuals will be effected.

 

What does MTD actually mean / hope to achieve in the long run?

 

  • Digital record keeping / software (paper records will no longer be "compliant")
  • A live tax account.  All individuals and businesses will be able to see a live balance of their tax liabilities and communications with HMRC
  • No more tax returns?  In the very long term HMRC have stipulated that quarterly digital submissions will replace the "end of year" tax return

 

MTD marks possibly the largest reform to the tax system in history... although at this stage it is worth stating that a lot of this is "planned" but may change considerably when it finally comes to pass.

So what does it all mean?

At the moment, the only confirmed requirements relate to VAT registered businesses;

 

  • From April 2019 all VAT registered businesses above the VAT registration limit will have to submit their VAT returns via software.  The HMRC "free" portal will cease to exist, as will the option of paper VAT returns
  • From April 2020 all VAT registered businesses below the VAT registration limit will also have to submit their VAT returns via software

 

Essentially by April 2020 all VAT registered businesses will need to use bookkeeping software and all VAT returns will have to be submitted via software.

Don't panic!

For our clients we will be offering two main lifelines to keep you compliant and hopefully removing any panic;

 

As a Sage Partner we can set you up on Sage at a reduced price, help train you and transition to using software if you are not already... that's it.  You will have all the benefits of using software and have ongoing help and support, as well as the ability to file your VAT returns straight from Sage.

 

For those that perhaps do not feel comfortable with software, or rather that we take the burden of bookkeeping and VAT returns away, we will offer inhouse bookkeeping and VAT return preparation as we have always done.  Behind the scenes we will be using software on your behalf, so that you see "no change" but are happy knowing everything is being taken care of and filed.

 

See details of how we work with our clients for bookkeeping below:

No need to panic, we are here to help!

 

We offer in-house bookkeeping, VAT return preparation and submission all as standard.  This can even tie directly into your year end accounts.

 

Feel free to give us a call if you would like to know more, or find out what MTD may mean for you...

Contact us for a friendly free chat...

If you have any questions or just fancy a chat then contact us now:

 

01268 561800

 

 

Or use our contact form.

We are located at:

Sygma, Chartered Accountants

1 Sopwith Crescent

Wickford

Essex

SS11 8YU

 

We cover all areas, and are always here for a chat, so why not give us a call?

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Sygma is a trading name of Sygma Accountants Limited, Company number 10821194
Sygma Accountants Limited is registered to carry out audit work in the UK and Ireland and regulated by the Institute of Chartered Accountants in England & Wales
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