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Making Tax Digital (“MTD”) is a new initiative from HMRC, aimed at making the UK’s tax system one of the most advanced digital tax administrations in the world.
Initially to be introduced from April 2019, MTD is designed to make it easier for both businesses and individuals to pay the right tax - and to gain better visibility of what you owe throughout the year. It means that whether you are a one-man band or a corporate giant, your business will soon be required to maintain digital records and submit your information to HMRC using compatible online software such as Xero. So, if you’re still recording your accounts on paper or spreadsheets, or even on desktop-based accounting software, things are going to have to change. Handily, we’re here to help provide a seamless switchover to the digital age. |
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Making Tax Digital: Who is affected and when?
The scheme goes live in April 2019 and will initially require all compulsorily registered businesses with turnover over the VAT threshold (£85,000) to file their VAT information online on a quarterly basis.
VAT registered businesses with a lower turnover will not be mandated in this first wave, but can choose to opt in should they wish. While an exact date for other tax requirements is yet to be set, it’s expected to land shortly after April 2020 - at which point all small businesses could become mandated.
That’s why it’s important to make the digital switch as soon as possible, to ensure you hit the ground running when the deadline arrives.
The scheme goes live in April 2019 and will initially require all compulsorily registered businesses with turnover over the VAT threshold (£85,000) to file their VAT information online on a quarterly basis.
VAT registered businesses with a lower turnover will not be mandated in this first wave, but can choose to opt in should they wish. While an exact date for other tax requirements is yet to be set, it’s expected to land shortly after April 2020 - at which point all small businesses could become mandated.
That’s why it’s important to make the digital switch as soon as possible, to ensure you hit the ground running when the deadline arrives.
