What is Making Tax Digital?

Making Tax Digital (MTD) is a government initiative that will eventually move virtually all tax/NIC management and payment online. It mandates digital record keeping and automated filing, this will require the use of compliant software.

Previously, most businesses were to be included within the move to MTD by Apil 2019. However, in the draft finance bill (2017) this changed and the government announced that the implemenation of MTD is to be scaled-back in the short term as follows:

  • From April 2019, VAT registered businesses with a taxable turnover above the VAT threshold will need to keep digital records for VAT purposes.
  • Other Businesses will not be asked to keep digital records or update HMRC quarterly for other taxes, primarily income tax and corporation tax until April 2020 at the earliest, pending further government announcements.

What are digital records?

Digital records are expected to record business information and specific transactional details. The VAT return information must be generated from these digital records and submitted to HMRC via an API (Application Programming Interface).

We realise that some clients are using manual records, spreadsheets, legacy systems and out of date software versions so action will be required in order to meet the MTD obligations.

What support are we providing?

We are committed to supporting our clients through the transition to MTD by offering a wide range of services from bookkeeping, implementation of accounting software to advice on automating bookkeeping routines. We appreciate that MTD will create fundamental changes for some clients and we are poised to offer recommendations and advice.

  • Bookkeeping Bureau - We offer a full bookkeeping service for our clients and will continue to do so using MTD compliant software.
  • Cloud and Desktop Accounting Solutions - We offer full training and implementation services for accounting solutions. We are finding that online accounting solutions are great for clients who may not undertake all of their own bookkeeping and would like us to collaborate.
  • Computer Solutions - We can organise and supply hardware for clients wanting to upgrade or considering a computerised solution for the first time.
  • Automation - We can set up systems to automate the processiong of bank transactions and scanned/digital purchase invoices to improve efficiences for clients using our recommended online and desktop solutions.

For more information please contact Nick Brearley or Steve Booth on 01422 352517 or David Stansfield on 01924 866020