Making Tax Digital is a government initiative that is expected to “Go Live” in April 2019 for anyone over the VAT threshold of £85k turnover a year. The expectation is that, for these people, they will need to submit 4 returns a year that show not only VAT information, but other tax information about their business.
Details are still being communicated, but this is expected to roll out to most self employed individuals, Partnerships and Limited Companies by April 2020, and will drastically change the tax return system as we know it.
It is likely to mean that small businesses that do not use accounting software will need to start using it from 2020, in order to comply with the new regulations. As of March 2018, the HMRC have stated that free software will not be available to do this on their website as per Self Assessments now. It will also mean that many businesses that have not used an accountant before, may need to engage one for the first time in order to comply.
We are keeping up to date with information as soon as it is being released by the HMRC, and will keep all of our clients as informed as possible. If you have any questions regarding Making Tax Digital and how it may affect you, please get in touch.