No owner of a business can afford to ignore Making Tax Digital for Business, even in the current coronavirus crisis. It is a major tax system change, and these are the main points to be aware of.

Who does it currently apply to?

Eventually, all UK firms will be covered by Making Tax Digital for Business, but since April of last year, it has been applicable to those that have profits that put them over the threshold for paying VAT. If you fall into that category, you should already be using the new system, but in the fairly near future both Corporation Tax and Income Tax returns will be dealt with digitally as well.

What actual changes does it involve?

The biggest change will be the scrapping of the yearly tax return, with this being replaced by tax data being submitted to HMRC several times per year through your Making Tax Digital account. This does not mean having to file multiple returns every year; just periodic updates on your finances will be fine.

What will you need?

Whether you are one of those who must comply now or in the future, you will need software that is compatible with the HMRC Making Tax Digital system, such as FreeAgent. Alternatively, if you employ a business accountant in South Yorkshire or wherever you are located, they should have this already.

At Adaptive Accountancy, we offer Making Tax Digital support and are available at all times rather than just standard office hours, if you need urgent help.

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