How HMRC’s Making Tax Digital initiative will impact on accountants and small businesses.

30 Jan 2017

An Article in The Sunday Times discussed how HMRC’s Making Tax Digital initiative will impact on accountants and small businesses. The MTD scheme will see businesses with turnover of as little as £10,000 a year having to file online every three months.

Some accounting firms have voiced concern about more of their work moving online, as it could mean fewer companies will rely on their services. In the immediate future, however, they could be banking more fees as digitally challenged businesses seek professional help. One business owner quoted by the paper states: "It's simply not necessary for my small businesses to report quarterly. It is only for the government to get money out of me up front."

As well as the additional costs, lobby groups and MPs have warned that the change is being forced upon vulnerable companies too quickly. There have been calls to delay the introduction date of 2020 and increase the threshold from £10,000 to £83,000. However, HMRC insists it is “committed to delivering Making Tax Digital within the established time frame.” Everybody that knows says that in particular saddling the self-employed with this burden dressed up as a “saving” as early as next year is irresponsible, but nobody at HMRC has ever been self employed and they seem to neither know or care.

At McLean Reid we have secured cheap, easy-to-use software and beefed up our book-keeping support (as we did with wages when they put that on line) and are geared up to help, but it shouldn’t be the job of Government to increase the costs of small businesses, or the administrative time required to generate the income that runs the country.