Pandle Survey: Almost half of small business owners believe Making Tax Digital will be more confusing than current Self-Assessment system
Pandle’s Small Business Survey reveals that the main concern of 48% of small business owners is that Making Tax Digital will be more confusing than the current Self-Assessment System.
In the survey of 1,000 small business owners 23% of respondents said they were not concerned about the switch to MTD while 13% fear they won’t be ‘tech savvy’ enough to use it and 11% believe it will create more work for them.
5% cited other reasons as their main concern, including not fully understanding the system and a fear of higher accounting fees.
By 2019 businesses operating above the VAT threshold will be expected to submit VAT Returns through the online system.
After this, all small businesses will be expected to submit quarterly tax updates through the new system.
How to help clients keep calm about Making Tax Digital
As an accountant, it’s worrying to think that MTD could cut out processes and mean that clients won’t have a use for accountants anymore.
However, it’s more likely that the opposite will happen.
Instead clients will need aid with the new tax system, especially if they fear it will be more confusing than the current Self-Assessment process.
Keep your clients calm when MTD comes into practice by updating your website with interesting and useful resources and get your firms’ software ready well ahead of the deadline.
Lee Murphy, Pandle’s director, said: “Although submissions are easier the tax system is still too complex, meaning that business owners who do self-assess feel that they are not claiming for everything they could be. This is confirmed in our survey results.”
Mr Murphy added: “For clients that are not currently submitting work on a quarterly basis it's a good idea to prepare them in advance of MTD being introduced as changing accounting systems from spreadsheets to software can sometime prove tricky.
“Clients will also need a period of time to get used to a new way of working and may require some training.”
If you’re concerned your clients will struggle with the Making Tax Digital switchover, get prepared by setting up an accounting software that will make the transition seamless.