Making Tax Digital is a Government drive aimed at making it easier for individuals and businesses to get their tax right and keep on top of their affairs.
HMRC’s ambition is to become one of the most digitally advanced tax administrations in the world – a bold step. To manage tax in the digital domain, HMRC needs businesses to submit financial information in a digital format.
VAT-registered businesses with a taxable turnover above the VAT threshold are required to use the Making Tax Digital service to keep records digitally and use software to submit their VAT returns from April 1, 2019.
While it may mean you have to make changes, it can help streamline tax and accounting. Just stop a moment and think about services you may already use regularly, like internet banking – you access your account details using the cloud and can do it from any device, at any time and in any place.
Think similarly about doing your tax digitally – it's all about the cloud and that brings a whole host of plus points.
Cloud-based software is generally relatively simple to use and it's designed to be user-friendly.
Cloud accounting software is a wise investment to help your business to work smarter and faster. Working in the cloud will give you a better overview of your finances and can improve collaboration within your team.
You can use cloud-based software from any device with an internet connection meaning you stay connected to, including accounts. The beauty of this is the flexibility it gives to run your business from work, home, or on the go. Wherever you are, you’ll always have the latest picture of how your business is doing.
The cloud is one of the most secure ways to store information. For example, when using cloud software, if your laptop is stolen, no one can access your data without a login to the online account.
In the event of a disaster like a fire or flood, being in the cloud means business continuity doesn’t need to be affected because there’s no downtime.
All your information is safely and securely stored off site. As long as you have access to any computer or mobile device connected to the internet, you’re back up and running.
Software updates can be developed and delivered faster and more easily in the cloud. This means you don’t need to worry about installing the latest version and you’ll get access to new features instantly.
Paperwork, receipts and invoices can be scanned, digitised and backed-up online – giving you and HMRC all the documentation needed to complete a tax return.
Digital data can be added to the relevant tax return template and submitted online directly to HMRC – meeting its digital requirements.
If you want your business to work smarter and faster, cloud is the way to go.
For businesses that have been paper-based for decades Making Tax Digital may be daunting, but help is available.
Consulting with your accountant will make the transition easier, because they will be well versed in HMRC and familiar with accounting software that simplifies making tax digital for businesses.
You can find more information on Making Tax Digital from the HMRC here.
Clark Integrated Technologies has helped many businesses move to the cloud, as you will see from our website.