Making Tax Digital
Making Tax Digital (MTD) came into effect on 1st April 2019. MTD is part of the UK Government’s recent efforts to ensure companies and individuals keep on top of their contributions. The introduction of MTD means that all VAT registered businesses (with taxable turnover above the current threshold, currently £85,000) from now on are required to use an HMRC approved software to keep their tax records digitally. This affects all businesses that trade in the UK, including international organisations that may process accounts within their home countries.
Companies operating from nations such as Sweden, Finland or Norway, but trading within the UK need to follow the UK Government’s guidelines closely to ensure they comply to avoid any penalties. The best way to achieve that is to outsource the book-keeping process to experts like us at Goodwille.
Goodwille specialises in helping non-UK businesses to expand into the local market. Their team can assist with many or all back-office tasks to ensure entrepreneurs and business owners are free to focus on the more important elements of their expansions. For more than 20 years, Goodwille has helped hundreds of international businesses open UK offices, launch UK subsidiaries, and deal with their ongoing compliance.
- Record keeping – International and homegrown businesses can no longer keep manual financial records for VAT. Starting from 1st April 2019, companies must use a compliant approved accounting system that connects to HMRC through an API.
- VAT submissions – While returns must be submitted to HMRC via approved digital software, there is going to be a soft landing period during the first 12-months, during which companies can still copy and paste data between software. However, this will change on 1st April 2020.
- Brexit – Making Tax Digital for VAT comes into force at the same time the UK plans to leave the EU. There are concerns that businesses dealing with VAT transactions between the UK and EU will become affected, and so it is vital that all companies keep on top of their understanding of any changes brought into force to ensure their systems comply. The best way of doing that is to outsource.
It is expected that most businesses will need to keep their corporation tax records digitally using specialist approved software by 2020. This means that now is the best time to put an outsourcing solution in place to ensure a smooth transition.
The aim of Making Tax Digital is to bring the tax system into the modern age and help businesses to save time and money. However, organisations based outside the UK could encounter the opposite outcome if they don’t remain ahead of the game and select an outsourcing partner like Goodwille as soon as possible.
For more information about the many ways in which specialists like those at Goodwille can remove some of the strain from the situation and ensure your business can thrive in the new Making Tax Digital landscape, visit www.goodwille.com today. Companies that fail to comply with MTD requirements could face fines or worse in the UK, hence it’s vital not to delay this move.
Outsourcing presents the opportunity for businesses to remain focused on their growth and expansion goals rather than watching alterations to the tax system. So, take the first step today!