Making Tax Digital – a transition towards digitisation

What is Making Tax Digital? An HMRC initiative for the UK tax system and ultimately bring an end to Self – Assessment. MTD is a Tax Revolution in the UK. The MTD’s aim is primarily to make Tax administration, a fully digitalized tax system by 2020. Its primary objective is to make the tax system “Effective, Efficient and Easier”. The Secondary objective is to make MTD as a Cost Cutting measure, and finally to cut down the overheads for HMRC for managing Tax affairs. MTD would bring changes in the tax system which will apply to a wide range of taxpayers, including most businesses, self-employed professionals, and landlords. Here comes the challenge where the businesses would now get their records to be digitized and further it requires a Cloud Integration. Making Tax Digital timeline: From April 2019, quarterly reporting is: Mandatory for VAT for all registered businesses with a turnover above the VAT registration threshold (£85,000 per annum) Optional for VAT – registered businesses with a turnover below the VAT registration threshold  From April 2020, quarterly reporting is: Mandatory of income tax and corporate tax (as appropriate) for all businesses (including landlords) with a turnover over the VAT registration threshold (£85,000) Three Steps to going Digital: 1. Digital Records Storing all Transactions in electronic form Cloud Accounting AR and AP data stored in electronic format 2. Digital Link A Digital Link is an electronic or Digital transfer or exchange of data between software programs, products or applications. The use of ‘Cut and Paste’ does not constitute a digital link VAT account – Audit Trial No Human intervention 3. Digital...

Setting up Self Employed

Becoming self employed is a dream for many people but there are a few things you need to know before you embark on the exciting journey of being your own boss. Business Structure You may need to think about the business structure that you need. Thousands of people begin as sole traders and this does suit most start-up businesses but it may be worth asking advice from a trusted business advisor to make sure that this is the best structure for your business. If you are going into business with one or more other people you can set up a partnership or a limited liability company, both of which come with pros and cons of their own. Regardless of the of business structure you choose you will need to register yourself as being in business. It may be as simple as filling in an online form with HMRC or could be slightly more complex depending on your requirements. If you are in any doubt at all you need to speak to someone who can impartially advise you about the process. Legal Responsibilities You must check if there are legal requirements for your type of business. Do you need a licence or a permit or some type of insurance? Being self employed is not just a case of beginning trading! Where Where will you work? Can you run your business from home or do you need an office or storage space? If you’re to be manufacturing goods do you need a factory or processing plant? If you rent or buy a business property you will need to register for and...
Paying HMRC by personal credit card

Paying HMRC by personal credit card

From 13 January 2018 HMRC will no longer be accepting payments made from personal credit cards. HMRC is only allowed to accept credit card payments on the basis that there is no cost to the public purse, and the EU Payment Services Directive 2, which comes into effect on this date, prohibits merchants (including HMRC) from recharging associated fees back to customers. Corporate, business and commercial credit cards are not affected by this change and HMRC will continue to accept personal and commercial debit cards. Customers will continue to have alternative payment options including: Direct DebtFaster PaymentBACSDebit CardCHAPS Details of ways to pay self assessment can be found on GOV.UK https://www.gov.uk/pay-self-assessment-tax-bill Share this:Click to share on Twitter (Opens in new window)Click to share on Google+ (Opens in new window)Click to share on Skype (Opens in new window)Click to share on WhatsApp (Opens in new window)Click to email this to a friend (Opens in new window)Click to share on Pinterest (Opens in new window)Click to share on Pocket (Opens in new window)Click to share on Facebook (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to print (Opens in new...