A survey of small to medium-sized businesses, conducted by the Independent, has found that 11% of UK companies are unaware of new tax requirements.
As of 1st April 2019, more than one million firms with annual taxable income over £85,000 are now required by law to submit VAT returns online. The same rules will then apply to trusts, local authorities, not-for-profits and public corporations from October. This is all part of HMRC’s new Making Tax Digital (MTD) initiative.
Of all the business leaders that responded to the survey, 46% that believed they were compliant with the new rules were found not to be, whilst 25% of compliant companies believed they were underprepared.
HMRC has been quoted to be taking a “light touch” approach towards penalties during the first year of the law’s implementation. However, this is only where they believe businesses are doing their best to comply.
Only 13% of respondents said that moving to MTD was more time consuming than they thought it would be, showing that the government’s plans to slow the pace of mandation might be working. MTD will not be mandated for taxes other than VAT until at least April 2020.
Businesses also need to keep digital records from the start of their accounting period using MTD-compatible software. It is best to do some research into which software may be best for you as many providers offer extra benefits that might be of help.
24 July 2019
The views expressed in this blog do not in any way constitute advice and are specific to the date noted. As time passes the facts can change and readers should consult their adviser for up to date advice on any matters covered within the blog. Invest Southwest offers an initial review, which is free of charge, however long it takes. From this we will be able to confirm how we can help and give you an opportunity to decide if you would like us to. Thereafter, we will provide you with detailed recommendations and exact costs. Please note that we promise not to levy any kind of fee unless we can demonstrate a benefit to you.