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Making Tax Digital – The Way Forward
Tax – chaos reigns! The government (in the shape of H M Revenue and Customs) have announced that landlords and unincorporated business will not now be compelled to maintain digital records and file quarterly returns with effect from April 2018 as announced hitherto. This is excellent news for many clients and appalling news for bookkeeping firms and some firms of accountants who have geared up for a glut of work premised upon the original governmental pronouncements. The most recent commentary emanating from H M Revenue and Customs (which may well change again, is that:-
1 All businesses will not be compelled to comply with the proposed Making Tax Digital system (as far as Income Tax and Corporation Tax is concerned until the year 2020,
2 With effect from April 2019 all businesses with a turnover of more than the figure at which registration for Value Added Tax purposes becomes mandatory (£85,000.00p at the time of writing) will not have any choice other than to maintain digital records and file quarterly returns (for Value Added Tax purposes) online.
It is important to note that this will mean the death of paper based accounting records and the use of spreadsheets in preparing calculations for Value Added Tax purpose as ALL records for Value Added Tax purposes MUST be held digitally.
We believe that, despite the uncertainty and the delay which has occurred in getting the project off the ground, it is going to be crucial for the groundwork which will need to be put in place is not delayed until April 2019 and that a pro-active stance needs to be developed immediately. The practice has already begun to put in place the necessary systems and the work required to be undertaken is now at an advanced stage. This prudent policy will be further developed over the coming months. To this end the practice has taken on board the most up to date versions of the accounting software available to accommodate the challenges that do lie ahead The main accounting packages sponsored by the practice are Quickbooks (Online), Sage, Xero and Kashflow. This is not an extensive list but it is a list of the main packages supported by the practice. http://casterbridgehardy.co.uk/team/saji-devassia-maat/
This seed change will not present any difficulties for our clients as they will receive full and unlimited support from our team of experts.