Govt has a plan for making tax digital or in other words its quick reporting to HMRC by using various available softwares.
The Association of Taxation Technicians (ATT) has said that the MTD project represents “the biggest change to the way taxpayers will engage with HMRC since the introduction of PAYE in 1945.”
According to the Institute of Chartered Accountants in England and Wales (ICAEW), a staggering 82 per cent of self-employed individuals and 75 per cent of businesses will need to completely change the way they currently keep their records in order to comply with the changes.
It is actually good move by HMRC. I would say its given little extra burden to Sole Traders and Landlords to gather information on quarterly basis and provide to their accountants earlier than a year. But there are more benefits of submitting information earlier.
- They will know the clear picture of their business so they can plan or adjust their plan according to quarterly results. in this case they will get current information regarding their profit and loss, cash flow, etc. from their Accountant.
- on the basis of this information they can adjust their budgets and future planing of the business.
- They will be more in touch with their records and will take care better in terms of filing and knowing where do you stand in terms of profit or loss.
- Also meeting or speaking to your accountant every 3 months would be another occasion to get the expert advice regarding other issues of the business.
- More frequent submissions will also help businesses avoid nasty surprises. Big tax bills can accumulate over the course of a year but when tax is calculated quarterly, things are far less likely to get out of hand.
Here is link below from HMRC plan to Making tax digital.
Oxon Accountancy provides £60 per month accounting which also includes free cloud based software to tackle your daily transactions and will keep you compliant with HMRC plans of Making Tax Digital.
Contact OXON Accountancy for further consultation on 01235 250011.