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SURVEY IS WAKE UP CALL FOR SMES IN DARK OVER MAKING TAX DIGITAL

Home / News & Opportunities / Member News

Date: 09/07/2018

Amid all the hoo-hah surrounding Brexit, the High Street in crisis, GDPR and the general busy-ness associated with running a business, it’s easy to see how the impending introduction of Making Tax Digital (MTD) has passed many SME business owners by.

The plan has sparked much controversy since it was unveiled in 2015 with business groups and senior figures on both sides of the political divide arguing that MTD was being rushed. In an enlightened move, the government made key changes to the schedule in July 2017.
However, nearly 12 months on, a survey of UK accountants and business owners carried out by Intuit QuickBooks has revealed that 41 per cent of SME owners are still in the dark about the concept, which requires VAT registered businesses with a turnover of above £85,000 to maintain a digital record of their VAT transactions and submit returns using MTD-compliant software from April 2019.
Intuit’s research also showed that 22 per cent of the 234 small business owners quizzed were only planning to file taxes digitally if they were to incur financial penalties. Three quarters of respondents (76 per cent) confessed that understanding the legislation was a challenge, closely followed by sourcing new tools to help them comply (70 per cent), finding time (66 per cent) and managing additional work (64 per cent).
The 180 accountants polled admitted client education is their major worry in the lead up to MTD (29%) though many can appreciate the benefits, including less stress on year end tax (64 per cent) and the opportunity to adopt a more consultative approach (59 per cent).
Here at Haines Watts Worcester and Evesham, we were alarmed to learn of the high number of businesses unaware of their tax obligations come next spring.
All business owners need to think carefully about how they are going to comply to avoid the risk of costly, and unnecessary, fines. Seek advice from your accountants now and don’t leave it until the last minute.
If a change in accountancy software is required, it is important to source and implement the correct package. Appropriate training for all users, carried out in plenty of time ahead of the change, is also essential.
Our experienced team can help ease your mind about Making Tax Digital. Get ahead of the game by contacting us today.
By Tim Pearce, Managing Partner Haines Watts