You may have heard about the government’s plan to make tax digital from April 2019 but what does this mean for you and your business?
A common misunderstanding amongst small business owners is that they are already doing tax digitally so there is nothing to worry about. For some this may well be the case, however for other who think making tax digital is just official confirmation that tax returns are submitted online there may be a surprise in store.
Whether this surprise is a rude awakening or a welcome change will depend on whether you like submitting your ins and outs to HMRC in real time or prefer to leave them until the last minute in January.
One thing is certain, the pressure will be on to put something in place that will connect to HMRCs system so that your business can report income. This will almost certainly involve additional expense investing in cloud platforms to satisfy the new digital requirements for those businesses that haven’t done so already.
The first phase of the scheme will be rolled out in April when VAT returns are due and HMRC has assured business owners they will not impose penalties while businesses adapt to the new system.