Making Tax Digital Checklist: Make Sure Your Business is Ready
Making Tax Digital (MTD) is one of the biggest shakeups even seen in the UK. HMRC is mandatory for all small to large size businesses to file VAT returns online. With HMRC it makes it easier for businesses to get a clear and accurate audit trail. If you have implemented Making Tax Digital Software for your business, then it’s important to understand how one can affect you when you need to prepare for it.
By 1st April 2019, Making Tax Digital for VAT in the UK will need to submit using functional compatible software. It’s a part of the HMRC which makes a deadline for creating an approach with making tax digital checklist to help you out. All must remember one thing is April 2019, which shows VAT-able turnover above the threshold. Then there will be no longer possible to submit VAT returns manually via HMRC’s website.
What do you need to get the business ready?
If you’re already using accounting software, then you need to check that your software provider will require upgrading with making Tax Digital Software compatible. HMRC will only accept VAT returns provided by the software to support Making Tax Digital for Business.
As per research, there are around 150 service providers such as SAP, Microsoft and more, who work very closely with HMRC to have MTD functionalities ready for April 2019. There are lots of companies who fall somewhere between two extremes will still keep all the records on paper by using MTD fully embraced accounting software that is used already.
If we check current scenarios, then 99% of VAT returns will file online on HMRC. Moreover, there are 15% of those who file directly through accounting tool where you don’t have to enter the VAT figures into the existing HMRC portal manually. We have advice for all VAT registered businesses is that one needs to start preparing now and move it to the digital cloud-based platform. Use any software conversions and internal training to undertake the before the deadline.
Benefits of Making Tax Digital for Business
For many of them Making Tax, Digital software looks like difficult process from which you need to understand and look into quickly realise to see the tax balance before year-end to help you to prevent errors and stop tax repayment at a larger stage. Use the key personnel to act upon any potential problems immediately. If we look at the central system that provides transparency of data will include all liabilities and entitlements. If your information is stored in the cloud, then you needn’t have to worry about the damage and loss. Get the vast business benefit to having a better grip on your finance.
• Save your precious business time: With using Making Tax Digital for business, you can save 27days annually. Use the digital accounting software in comparison to use other manual methods.
• Useful Saving: With using digital accounting software, one can estimate £17,000 money saving per annum.
• Prevention of late filling: If you have set automatically then the auto-submit will prevent payment from piling up and reduce the chance of incurring or error penalties.
• Make use of information better: Get access to real-time updates using the information that HMRC holds you to check that they are correct at any time.
If you want to make the possible checklist that will help you to grow your business well with generating a great outcome, and then use these below points to understand better.
1. Do you need to figure out if your business will impact by Making Tax Digital for VAT?
If you have your business VAT registered, then you should have a turnover above VAT Threshold then Making Tax Digital software will be required. If your business isn’t VAT registered, but it approaches the VAT threshold, then one needs to understand the Making Tax Digital for VAT requirements with adding possibly seeking the advice of an accountant to prepare for it.
If your business is new in the market or the growing stage and you think you’re affected by Making Tax Digital for VAT then you should attempt to project your income for remaining business to see if you qualify. Making Tax Digital for business is all about filing the tax digitally when you require storing some of your VAT information digitally linked. So, for that one need to start preparing for these requirements well in advance which business processes you need to adapt for Making Tax Digital for VAT? Retrieve the best usage of Making Tax Digital.
2. Ensure you’ll have useful compatible software for Making Tax Digital for VAT?
You need to use the software that works great on the HMRC’s Making Tax Digital for Business with keeping the digital record related to your VAT for communication. You need to file the VAT returns which sometimes referred to as a technical language to connect to HMRC’s APIs. If you have a desktop from which you’re going to file the return then obviously you need to update the software for MTD (if you have already upgraded, they avoid this). Later, you can speak to your software vendor if you’re software isn’t working while transferring the VAT accounting.
3. Work out on when you need to switch to Making Tax Digital for Business?
It’s possible to switch to Making Tax Digital for VAT now with using accounting software vendor by merely signing up to beta Programme. HMRC comes with maintaining the list of vendors which doesn’t mean all software packages from each vendor are Making Tax Digital software compatible. Your accountant should take care of how you’ll switch to MTD for VAT, as probably there is still a chance that the government might adjust the Making Tax Digital for VAT specification or any deadline. With the recent month, news shows that the government has published VAT notice that covers Making Tax Digital for VAT where you’ll find no doubt that it’ll be implemented by April 2019.
What is the benefit of SAP Business One in the context of MTD?
SAP Business One solution has an engaged HMRC team of management that provides a solution to address the requirements for Making Tax Digital. MTD allows companies to manage the submission of VAT returns via software in a digital form. SAP Business One Software is underway to the future roadmap to ensure compliance. With a new patch level updates, SAP Business One brings the best solutions to have MTD readiness. If you have any questions related to MTD with SAP Business One in general, and then contact our SAP Business One team today.