In Denial about Making Tax Digital?
Such has been the poor consultation and communication on the looming Making Tax Digital legislation by HMRC, it is becoming increasingly apparent that Small Business owners, Sole Traders and Contractors alike are blissfully un-aware that there is a massive change to their Accountancy and Tax reporting obligations around the corner.
Businesses who have already started to adopt such technological advancements in financial management and reporting, like cloud accounting and expense management systems, may well cope with the transition very well as they already have most of what they will need in the required format – even if HMRC doesn’t get third party software integration correct, they will have the information they need in the format they need it in – Digital!
Those who have not yet adopted more efficient and streamline digital processes may struggle under the added administrative burden posed by MTD, it is likely to require quarterly reporting and will place a real emphasis on businesses keeping their records up to date throughout the entire year and not just handing everything over at year end.
The next critical component to a successful adoption of Making Tax is going to be a good relationship with your accountant, and a more collaborative approach will be required to make sure everything runs smoothly and on time throughout the year. Cast aside will be the accountants that pop up at year end to take your files off you in return for a substantial invoice, replaced with innovative accountants who build a collaborative relationship with their clients are are on hand all year round for support and services they will be!
If Making Tax Digital is not keeping you awake at night, you either already have been in touch with us to see how we can ensure you and your business are ‘MTD Proof’ or you don’t know that much about it and soon you will be!