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How technology will help you when Making Tax Digital starts

10th Dec 2018
Brought to you by
downlaod

The Access Group provides integrated business management software.

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Have you found this content useful? Use the button above to save it to your profile.

As one of the main planks of HMRC’s attempts to plug the gaps in the tax system and ensure that the potential for loss is as low as possible, the MTD reforms are designed to boost efficiency for both the individual taxpayer and for the Exchequer.

For those who currently rely on either rudimentary technology or even pen and paper for their VAT tax returns above the £85,000 threshold, however, Making Tax Digital could instead seem like a headache rather than an opportunity. This article will point out some of the benefits that you’ll start to see once Making Tax Digital kicks in and you begin to shift your tax return process to the web.

Regulatory compliance 

The main way that technology will help you once Making Tax Digital kicks in is, of course, by ensuring that you’re not failing to meet your obligations. The new rules mean that you’ll have to use a system that integrates with HMRC’s API, either directly or by using a piece of “bridging software”.

While you’ll have a few months after the general implementation date of April 2019 in which to ensure that you have all of this set up correctly, getting it going now is a wise move in order to ensure that you’re on the right side of the rules.

At-a-glance data 

However, the benefits of investing in a portal that allows for simple technological submissions of your VAT returns goes way beyond ensuring that you don’t fall foul of HMRC’s new rules. It can also have direct business benefits.

Take the example of data-gathering: the sorts of accountancy software packages that HMRC is encouraging you to use for compliance reasons are also the sorts of software packages that allow departments across the company to assess financial performance straight away.

If your finance team or accountant currently fills out the VAT return using a locally stored spreadsheet, then other departments – such as the C-Suite – may have to request access. However, by using a piece of smart, cloud-based software to do it instead, all participants will be able to find the data points they need in seconds.

Audits 

In the event that you need to have an audit carried out in the future, this technology will make things extra simple. Pieces of paper can get lost, and simple spreadsheet files can get deleted or corrupted. Opting for Making Tax Digital-compliant software or integrated, smart spreadsheets, however, is a great way to be certain that you’ll always have the items you need to present when you need to present them.

If you’re concerned about the technological impact of Making Tax Digital, then it’s perhaps wise to instead see its arrival as an opportunity rather than a threat. Technology and software aren’t just a necessary evil in the modern age – they’re great ways to keep ahead of the curve and make significant efficiency savings, and they’re ideal for sharing data effectively across a firm.

Visit our resource hub to find out everything you need to know about Making Tax Digital

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