Business owners need to take action now if they are to be ready for a revolution in the way they file their tax returns, according to a leading chartered accountant.
It is just over a year until the majority of businesses, self-employed people and landlords will be required to keep track of their tax affairs digitally and to update HMRC at least quarterly via their digital tax accounts.
The transformation, called ‘Making Tax Digital’, will force SMEs to use digital tools, such as software or apps, to keep records of their income and expenditure.
Phil Bates, Principal at Cheshire-based chartered accountants Phillip Bates & Co, said: “The legislation is due to begin taking effect from April 2018 which means the first digital tax return will be due in July of that year.
“The changes should significantly improve the way companies manage their accounts and tax affairs and improve their ability to plan ahead and react to issues within their business.
“For example, business owners will no longer have to wait until the end of the tax year to discover how much tax they need to pay.
“But in order to comply with the ‘Making Tax Digital’ legislation will require the vast majority of businesses to introduce new technology and ways of working.
“The team at Phillip Bates & Co has undergone training in many of the Cloud accounting software systems available to businesses.
“We have already begun the process of advising and supporting our clients as they move across to this new way of working and will continue to do so throughout 2017.
“Some businesses have already successfully integrated online software into the way they do their business, but many others depend on spreadsheets or, in certain cases, old-fashioned pen and paper.”
Phillip Bates & Co is based in Neston but works with SMEs across Cheshire, Wirral, Merseyside and North Wales.
It is one of only a small number of Chartered Partnerships in the region offering both a chartered accountants and chartered financial planners with its sister company Phillip Bates & Co Financial Services.
Phil added: “Businesses can ensure themselves a smooth transition to ‘Making Tax Digital’ if they start process sooner rather than later.”
NOTES TO EDITORS
- For an interview with Phil Bates or more information, please contact Nick Mason at Mason Media on 0151 239 5050 or email: firstname.lastname@example.org/ www.pbates.co.uk