From the 1st of April 2019, the Government’s Making Tax Digital Initiative will be rolled out across the UK, meaning all individuals and businesses turning over the VAT threshold will need to submit all financial updates digitally to the HMRC using recognised accounting software.
All records must also be stored, maintained, and submitted in digital format as part of the new MTD For VAT rules. Digital records and VAT returns must be submitted using specialist software known as the Application Programming Interface or API.
But how will Making Tax Digital benefit your business?
Streamlining your existing processes
One of the main benefits of Making Tax Digital is that it will streamline your current tax processes and procedures by making it quicker and easier to gather the information you need, trace individual transactions and most importantly, get your figures right.
Thousands of businesses struggle to keep on top of their finances, which means mistakes are often made. Specialist software reduces the risk of costly mistakes and helps businesses to gain a true understanding of where they stand financially.
The digital world never sleeps, allowing businesses to access their finances and keep track of their tax and repayments anywhere, anytime. This instant accessibility will allow you to keep track of your tax balance, so there are no nasty surprises when the time comes to submit your accounts!
Digital platforms will allow you to access all of the information you need without the need to sieve through mountains of paperwork in order to submit your figures to the HMRC each quarter.
Keeping a record of all your data digitally also provides you with better control of your finances.
So are you ready for April 1st?
All businesses should now ensure that they have MTD compliant Making Tax Digital Software in place before April 1st.
Businesses should also ensure that their existing accounting records are compliant with MTD regulations and that all VAT policies and practices are up to date.