From April 2019, every business in the UK that makes over £85,000 will be required to submit their UK tax returns digitally to HMRC. Making Tax Digital or MTD, will affect every organisation and the way you run your system is more important than ever. On the bright side, having a digital process will help you in the long run for reports on tax and it doesn’t have to be a large paradigm shift of uncertainty if you prepare for the change.
Due to Making Tax Digital, organisations will no longer have to wait a year or more to know how much tax they need to pay. The new change will allow you to see a single view of their liabilities and entitlements in one comprehensive financial picture. The way HMRC will do this is by collecting and processing information faster to stop repayments owed and reduce errors, making HMRC one of the most digitally advanced tax administrations in the world.
In line with general principles and requirements set by HMRC, Muse will enable its users to comply with the new Making Tax Digital regulations. Keeping records digitally and providing updates to HMRC from your accounting package which will reduce the amount of avoidable errors that a business makes. With this new solution, we are aiming to help our customers secure their compliance to ‘Making Tax Digital for VAT obligations’ with numerous other benefits to your business.
There’s more good news for small businesses. The switch is not as hard (or expensive) as you might first think. If you’re a small business who hasn’t already moved to a compliant cloud-based accounting package, then we have some tips:
1. Make the switch to cloud
Cloud accounting provides business owners with all the functionality and benefits offered by on-premise software like Sage 50, or Sage 200. It’s just that the software is accessed online and your data sits on a secure off-site server that you can access whenever and wherever you need it (sounds handy).
2. Get the Muse App
Not everyone out there is ready for the digital move. Experience tells us that business owners rely heavily on spreadsheets rather than their accounting software to retain records and to calculate and compile their VAT returns. Why not simply automate a lot of the headache with the Muse App, track expenses and monitor your cash flow too.
3. Prepare for the future
There is no doubt Making Tax Digital is the future for tax submission. The new HMRC regulation means businesses now have to figure out how they will comply to the regulation. Your decision to move to the cloud has a range of benefits and it is important to keep on top of your finance.