How is Your Business Preparing For The Digital Tax Regime?
By now, you’ll undoubtedly be aware of HMRC’s ‘Making Tax Digital’ (MTD) project. The aim of the project is to modernise the entire tax system by requiring all businesses to manage every element of their tax affairs online by 2020. The new system is scheduled to be implemented from April 2019 and will have an effect on every UK taxpayer, from large corporates to OMBs, SMEs and individuals.
Whilst there has been no firm confirmation yet, it’s expected that HMRC will unveil and begin to implement its plans over the next eighteen months, so it’s important to ensure you’re getting ready for the digital tax system in good time. Here are two things you can do now to ensure that you and your business are prepared:
1. Plan for the move from annual to quarterly reports – The new system will require both businesses and individuals to submit a tax report four times a year, a change which is likely to impact upon both the amount of work required from you and when you’ll need to schedule management of your tax affairs. At the moment, information from HMRC on the change is limited so planning in detail may prove tricky, but it’s a good idea to get as ahead of the curve as you can.
2. Have a look at your finance and administration teams – It’s possible that your business will need to recruit further resources in both finance and admin to get to grips with the online system, or perhaps pay for external specialist advice. This in turn could have an impact on your financial planning so it’s worthwhile thinking ahead on this.