HM Revenue and Customs (HMRC) are embracing the digital revolution and making fundamental changes to the way the UK’s tax system works. The Government is referring to these changes as “Making Tax Digital” (MTD).
The key elements of MTD are:
Businesses will be required to keep digital records
Businesses will be required to update HMRC with quarterly reports
An end of year submission/annual taxable profit calculation will be required
HMRC are proposing a staged introduction to the new rules, starting for many businesses in April 2018 and completing the roll out in full by 2020.
HM Revenue & Customs (HMRC) are changing the way they collect tax information. The changes, referred to as Making Tax Digital (MTD), are billed as a “digital revolution” that will “transform the experience of millions of taxpayers”. The changes will come into force from April 2018 with plans to deliver a full digital tax service by 2020.
With commodity prices fluctuating wildly in recent years, profits (and hence tax liabilities) can also fluctuate from one year to the next. Given the HMRC payment on account system, this can mean that your tax bill is higher than necessary.
Payments on account are calculated as 50% of the prior year’s tax bill, with one payment due by 31 January of the tax year, and the other payment due by 31 July after the end of the tax year.
Major changes are being made to the way in which all taxpayers interact with HM Revenue and Customs (HMRC). The Government is referring to these changes as “Making Tax Digital” (MTD), and they are proposing a staged introduction to the new rules, starting for many in April 2018.
Larking Gowen has prepared and submitted a comprehensive response to HMRC’s consultations on Making Tax Digital with regard to how it impacts our clients and suggesting matters to improve implementation for businesses.
There is a record number of self-employed workers at the moment, approximately 4.6 million, which represents about 15% of the UK workforce. They are also spread across a diverse group of sectors, including agriculture, construction, transport, the art world, hairdressing and travel writing.
Back in July 2015, the Government commissioned a report by Julie Deane OBE, the CEO and Founder of The Cambridge Satchel Company.
Much has been said about HM Revenue & Customs’ plans to bring the way they collect tax information up to date by embracing technology. The changes, referred to as Making Tax Digital, are being billed by HMRC as a “digital revolution” that will “transform the experience of millions of taxpayers”.