On 21st July, the Government announced their new timetable for Making Tax Digital (MTD). This is part of their 10 year plan, to modernise the current tax system. Only those over the VAT limit have been obligated to keep and submit their data in digital formats so far. So what is changing? Well, here are the important dates from when MTD will apply –
April 2022 – All VAT registered businesses, even those under £85k
April 2023 – All Self Employed Businesses who pay Income Tax, including Landlords with Rental Income
TBC – Limited Companies who pay Corporation Tax
So what is MTD and how does it apply to you? Well, in a nutshell, it means that you will have to keep digital records of all your documents such as your invoices and expense receipts. These are then sent to HMRC, through 3rd party software on a quarterly basis, rather than the annual basis which we submit now. I know what you thinking, seems like an awful lot of work doesn’t it? Well no, it doesn’t have to be and here’s why.
We are moving ever closer to this happening and we would like to be as prepared as possible when the time comes, which is why we feel it is so important to start implementing small changes now. This year we have teamed up with Receipt Bank and Accountancy Manager, to work with you to make a move towards digital record keeping. Over the coming months, we will work with each of you individually on a case-by-case basis, to get the best way for you to start reporting information to HMRC, that meets statutory filing requirements but that causes minimal impact to you and your business.
We will be here to walk you through this every step of the way, so if computers aren’t your thing or you are worried about having to get too ‘techie’ don’t be. We have solutions to help everyone.
Still unsure? Contact us at the office anytime to discuss the best plan for you and your business.