A new study, commissioned by Accountancy Age, entitled, A Tax Professionals Survey 2019: Attitudes and Approaches To Making Tax Digital, argues that greater support is needed for businesses in order to get more businesses MTD ready before the Government’s MTD deadline hits.
The irony is that MTD’s growing awareness hasn’t resonated with business owners to get their own MTD affairs in order! With nearly 50% of businesses stating they are not MTD ready with around 25-30% still in the “planning stage” and 20% shockingly not even at the “contemplative stage” showcases the scale of the problem.
Why Is This News and Why Should I Care?
Making Tax Digital is a new HMRC scheme that plans to “revolutionize” the way the UK tax system works with an end goal of ending “self-assessment” with a continual assessment in real-time.
The core principle of Making Tax Digital is to make the administrative process of tax management more efficient and effective for both the business, the accountancy service provider and the Government. This is to be achieved by Making Tax Digital and implementing a fully digitized tax system by 2020 – which will reduce HMRC’s costs on traditional paper-based systems.
The scheme will affect a whole raft of different tax experiences – from business, personal, self-assessment to landlords. The new push for digital records, using compatible software like QuickBooks, will create a new digital tax landscape that helps to make tax easier to manage and quicker to gain compliance.
Why Does This New Report Matter?
The report outlines that more businesses need to become MTD compliant. According to the report:
“Our results suggest the need for more education from vendors around options for process testing since 58% of respondents did not know about options to test processes before formally signing up to the service.”
The reality is that with 58% of respondents not knowing enough about digital service vendors and the interoperability of MTD within this new ecosystem showcases the disparity between those who are MTD ready and those who are not.
Five Tips to Help You Get Your Business MTD Ready!
Here are five easy tips to help you get your business on the right track for MTD compliance:
- Knowledge is Power – Get to Know MTD Today
You need to know what MTD is and how it will affect your business. Visit Gov.UK to find out more about Making Tax Digital – also discuss with your financial accountancy partner what the implications are for MTD on your business.
- Register for HMRC Client Services
Either as an organisation or delegate it to your financial accountancy partner, you should sign-up with HMRC client services as-soon-as-possible in order to help get the ball rolling on MTD compliance.
- You May Be Already Holding Financial Data Digitally
Congratulations… You’re probably not aware but there is a good probability that you’re already recording and storing accountancy and tax data electronically, via QuickBooks or other software platforms. You will need to invest in MTD compliant software like QuickBooks.
- Choose The Right MTD-compliant Software
You need to make sure you pick the correct software for MTD accountancy. For example, platforms like Sage and Xero are compliant but you also need to consider ease-of-use. Therefore, Prestige Business Management as an approved QuickBooks partner can help businesses set up MTD-ready QuickBooks so that you can remain compliant from day one!
- MTD Isn’t Going Anywhere!
This isn’t a “flash in the pan”, MTD is here to stay and you will need to place MTD into your ongoing framework for financial management. There is no reverting back to the HMRC government gateway platform of old, MTD is here to stay!
How Can Prestige Business Management Help You Embrace MTD-Ready?
Prestige Business Management can help you understand Making Tax Digital, help you pick a vendor like QuickBooks to help you maintain digitalized accountancy records whilst helping you to understand the compliance framework.
Automation will help businesses and individuals move away from “the spreadsheet”, the report notes, and into a new frame of mind that places compliance not in the realm of Microsoft Excel but by using QuickBooks to help intuitively identify compliance issues.
More people need to be mare aware; Prestige Business Management can help you understand how MTD works and how digitalized accountancy records can be maintained thanks to QuickBooks accountancy software. Call us today on 0203 773 2927