The role of technology for microbusinesses in numbers
25th Nov 2020
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The release of the Lloyds Bank 2020 Transformation with Tech report has clarified the position that technology has in helping micro-businesses adapt and survive. With Making Tax Digital for VAT becoming mandatory for all VAT registered businesses from April 2022, we take a look at what we’ve learned and what’s yet to come.
Diversification in numbers
19% offered new products and 20% offered new services
23% streamlined their business
40% diversified into new areas
The accountant’s role
For accountants supporting micro-businesses as they establish themselves in the UK market, 2020 has been a challenging year.
The numbers reported around adapting business strategy only serve to highlight the changing role of an accountant, from the numbers-focussed expert to a business advisor who has a valuable impact on their clients’ future.
The impact of technology in numbers
48% say they would’ve ceased trading due to the pandemic without adopting digital technology
27% ventured online for the first time, with 47% finding ways to simplify their business using technology
35% report cost savings associated with digitalisation
Making Tax Digital and microbusinesses
The report from Lloyds is encouraging as HMRC looks towards the spring 2022 roll-out of Making Tax Digital for VAT to all VAT registered businesses. For many successful micro-businesses, this will present a fresh challenge and opportunity to further benefit from digitalisation.
Our experience of the initial phases of MTD for VAT has proven that the most benefits are felt by those who have prepared ahead of time to join the initiative. Your clients will now look to their accountants for further guidance in signing up, digital record-keeping and submitting digital returns to HMRC.
Whether you provide a flat-rate all-in-one VAT service or take a more ad-hoc advisory role, the coming 12 months will be the key window to help VAT registered small businesses prepare.
Our customers tell us that BTCHub provides a simple solution to managing their clients’ VAT returns under Making Tax Digital.
As smaller businesses are brought on board, it is more important than ever that your MTD for VAT software can cope with the wide variety of bookkeeping solutions available to them. Keeping costs down is also a priority for your clients, so BTCHub allows for digital records to be kept in Excel and transferred to MTD without requiring small businesses to invest in a whole new suite of products.