Why Making Tax Digital is an opportunity for firms and their clients
Cheryl Price started her practice CH Accountancy in 2014. Since then, the practice has gone from strength to strength – employing two staff members and working with over 275 clients.
Cheryl was one of the first Xero partners to try Xero’s Making Tax Digital (MTD) for VAT functionality last year.
Now a seasoned pro and with MTD for VAT just around the corner, Cheryl outlines why this scheme is an opportunity for firms and their clients.
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Why did you set up your own firm?
I’m a mum of five so I’m certainly kept busy. One of the reasons I set up CH Accountancy was so I could be more flexible and spend more time with my kids.
CH Accountancy is a practice run by mums for other parents. We typically work with sole traders and small limited companies.
What’s your experience with Making Tax Digital so far?
I’ve found the digital switchover smooth and simple. Since filing our first digital VAT Return in July 2018, we have gone on to onboard nearly all of our eligible clients, ahead of the April 2019 switch date.
We recently had our first VAT inspection of a return that was filed under the MTD scheme. It was so easy to find the return and show the invoice in question from Xero. The inspection was over before I knew it.
What’s changed with Making Tax Digital?
We’ve implemented new internal processes in line with the changeover to MTD for VAT.
Clients upload their receipt and raise and send their invoices through Xero. It’s been beneficial for everyone as it saves us heaps of time and leaves less room for human error.
Why is Making Tax Digital an opportunity?
Most VAT registered businesses will need to be compliant with MTD for VAT by 1 April 2019. I see this as a great opportunity for firms to switch their clients onto accounting software.
When I transitioned my clients, it wasn’t just about needing to be MTD compliant. Accounting software has had such a positive impact on my firm and I wanted my clients to benefit too.
Whether it’s up to date financial information or cash flow forecasting, MTD is really a chance to show clients what else accounting software can do for them.
What do you think of Xero’s Making Tax Digital functionality?
So far, we’ve onboarded 35 clients using Xero’s MTD functionality.
As the pilot programme has progressed, I’ve noticed Xero’s functionality has become slicker, with more information pulled from HMRC so you can easily view your account balance and what needs to be paid.
The new little dashboard function is a great feature too – with everything in one place, it saves us lots of time.
What would you say to the firms that aren’t Making Tax Digital compliant yet?
As somebody who has been there, I can assure you it’s not scary or difficult.
The sooner you jump on board, the sooner you can start benefiting from a more effective and efficient way of doing your clients taxes.
Signing up to Xero’s Making Tax Digital functionality will give you a headstart on other firms. It will also allow you to iron out any issues in plenty of time for the mandatory switch over and under a lot less pressure.
If you’re a Xero partner, you and your clients that meet the latest criteria set out by HMRC can join Xero’s MTD for VAT beta programme now. For more information speak to your account manager or email [email protected].
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