Haslers has said that companies across the region need to get ready for Making Tax Digital – the Government’s new online tax system – by incorporating online accounting software into their business.
It has been revealed that this new system, described by many as the biggest change to taxation in more than 70 years, will begin to be rolled out for businesses above the VAT threshold in April 2019.
For the first year, these businesses will only need to report VAT-related taxes on a quarterly basis online using cloud accounting software or via a spreadsheet fed into similar systems.
Businesses will not be asked to keep digital records, or to update HMRC quarterly, for other taxes until at least 2020.
Companies, sole traders and landlords below the VAT threshold will still be able to use the Making Tax Digital system on a voluntary basis to record and report their tax affairs.
This differs drastically from the Government’s previous plans, which would have seen all businesses, landlords and self-employed taxpayers with an annual turnover of £10,000 or more register, file, pay, and update their information online each quarter.
Jon O’Shea, Chairman and Tax Partner at Haslers, said: “While we welcome the Government’s changes to this onerous system, we still feel that many businesses aren’t yet prepared for Making Tax Digital.
“Even though plans have been delayed under these new plans by around one to two years, companies can still benefit from using online accounting systems.”
Online accounting packages, such as Xero, allow businesses to monitor their performance and collaborate with their professional advisers in real-time. The packages also allowing them to safely and securely store invoices, receipts and other important documents in the cloud, added Jon.
“We have already assisted a number of companies to incorporate online accounting into their business and they are already reaping the benefits of these innovative systems. I would encourage all firms to explore the potential benefits of the software on offer, whether they are bound by digital taxation or not.”
To find out more about Haslers’ range of online accounting and cloud services, please call 020 8418 3333 or visit www.haslers.com