Making Tax Digital is a live issue affecting SMEs. Although the implementation of the new online system has been delayed until 2020, the government has recently published draft rules to indicate how Making Tax Digital will work. Companies will have to file income tax and VAT quarterly with approved digital software that is compatible with the HMRC’s online system, and keep detailed digital records. The introduction of these new procedures could require changes for some businesses, and result in the need to invest in software.
Familiarising yourself with the new rules is important to help prepare your business for change, and start planning strategic investment in new infrastructure needed to accommodate Making Tax Digital within your business.
The rules also stipulate that once Making Tax Digital for income tax is introduced, firms will be legally required to keep a digital record of each and every business transaction.