As the deadline for Making Tax Digital looms ever closer, we at Millhouses Accountancy are helping more and more business to successfully transition to the new way of reporting tax either by managing the tax on behalf of our clients or by helping our clients learn how to manage it themselves – and we’re here to help you too!
We’re experts in Making Tax Digital for Business (abbreviated to MDT or MTDfb) and we’re also XERO partners and experts which is one of the most popular online accounting software packages compatible with MDT for VAT.
Here are a few of the most commonly asked questions
WHAT IS MAKING TAX DIGITAL?
Making Tax Digital (MTD) is an HMRC initiative designed to make sure the UK tax system is effective, efficient and easier for taxpayers.
WHEN DOES MAKING TAX DIGITAL START?
Making Tax Digital for business (MTDfb) begins on 1 April 2019 with MTD for VAT. From that date, VAT-registered businesses above the threshold of £85k will have to keep digital records and submit VAT returns using compatible software. Other components of Making Tax Digital, such as income tax and corporation tax, have been placed on hold until April 2020 at the earliest.
WHY IS THE GOVERNMENT MAKING TAX DIGITAL?
The aims of the changes are primarily to make tax recording more accurate, to reduce errors, and to reduce miscalculations and fraudulent activity. The new process will ultimately be faster and more automated for businesses, accountants and HMRC, helping businesses save time.
HOW DO I PREPARE FOR MTD?
There are several steps you should take to prepare for Making Tax Digital, most notably should be to find out when you need to move over to the new system and how your tax returns should be done in the future. We’re experts in MDT, accounting for businesses, and also the XERO accounting software package that we recommend so give us a call and we’ll help you with the next steps.
WHY DO WE RECOMMEND XERO ACCOUNTING SOFTWARE?
There are many reasons we recommend the XERO accounting software package. For example, it integrates directly with feeds from banks, software applications and financial institutions mean that data is untouched by human hand as it enters Xero, minimising errors. Xero’s wide range of security and detection measures enable tracking of who does what – and if issues are detected, alerts are raised. Tools such as the assurance dashboard, reports on activity, account transactions and journals also help advisors monitor the integrity of data in Xero.
Get in touch and we’ll help guide you through getting started with Making Tax Digital.
Call Millhouses Accountancy today on 0114 345 0960