Can you handle it?
At the end of last year the government published a corporate report titled “making tax digital” (PDF opens in a new tab), which set out how HMRC would make the tax system “more effective, more efficient and easier for taxpayers”.
A lot of what report has to say may be broadly welcomed by businesses, large or small. The report lays out a desire to simplify taxation by, for instance, making sure all of the systems that held relevant data are joined up. It seeks to encourage further digitisation to speed up transactions, improve accuracy and reduce the opportunity for fraud. It also seeks to make sure that HMRC offers a single point of contact to customers what ever their query.
As the Americans would say there is a lot of “motherhood and apple pie”.
One of the points raised in the report has raised alarm bells in the business community and amongst the accountancy profession. The point is stated blandly “businesses will keep their records using digital tools and send that information at least quarterly to HMRC”.
Although the “R-word” isn’t used, many commentators have said that this means quarterly returns will be required from limited companies, the self-employed and landlords. Software and apps may be made available to help the process but it may require greater on-going, diligence in collecting and managing data, and having more to do with us as accountants.
Lewis Smith & Co. will keep you posted on any news of what the government does on this topic, although the EU referendum and the Summer recess means that it will probably be Autumn before any formal activity.
As partners for both Xero and KashFlow online accounting packages we can offer help and advice on the process of going digital. As to the advent of quarterly returns, you can be assured that we will do our best to minimise any cost implications.
If you have any questions about the impact of “making tax digital” on your business call us today on 01384 235549 or email us at info@lewissmith.com.
Lewis Smith & Co. – A complete tax planning service for businesses, partnerships, sole traders and social enterprises.
