It has been revealed that HM Revenue & Customs (HMRC) is to delay some elements of its Making Tax Digital (MTD) initiative to free up staff to assist with the upcoming complexities of Brexit.
Despite this announcement, award-winning professionals, Salhan Accountants, are warning businesses that they have less than a year until their businesses are affected by elements of the new digital tax regime.
In an internal memo on the Customs Declaration Service IT programme, HMRC’s Chief Executive, Jon Thompson, said the department had “proposed a number of projects which should stop, or not start and a number which should be stretched out over a longer timescale.”
Amongst those MTD projects delayed are simple assessment, which was intended to simplify the tax return process for those people with relatively small sums to declare and real-time tax code changes, which allowed the revenue and employers to communicate changes on individual’s tax codes more easily.
However, VAT-registered businesses over the £85,000 VAT registration threshold will still have to prepare themselves for the first element of MTD – quarterly online reporting of VAT via HMRC-compliant software.
“It comes as no great surprise that certain elements of MTD have been delayed, considering the complexity and relatively short time period that the Revenue gave itself to implemented its strategy – especially against the backdrop of Brexit,” said Dr Anjulika Salhan, Director at Salhan Accountants.
“However, regardless of what future plans HMRC may have, businesses need to be thinking about the here and now. Just around the corner is MTD for VAT. In fact, companies over the threshold now only have months left to properly prepare themselves for this big change.”
Anjulika said it was essential that those in this position seek out help with online accounting if they hadn’t done so already.
“While this change won’t be as significant as some of the other proposals put forward when MTD was first announced, failing to be compliant with the new rules could see businesses face penalties,” she added.
“Taking your accounts online not only ensures you are compliant but also opens up a whole new world of digital tools, which can give you access to the information you need, no matter where you are in the world – ensuring you make decisions based on the most up to date information.”
To find out more about Salhan Accountants services, please visit salhanaccountants.co.uk
