What law firms need to know about Making Tax Digital
Making Tax Digital with InTouch
InTouch is ready for MTD through our real time sync with Xero accounting software.
Making Tax Digital is an HMRC initiative designed to make sure the UK tax system is effective, efficient and easier for taxpayers. The MTD initiative means UK businesses such as yourself will need to store digital records and submit updates to HMRC using recognised accounting software.
With our real time sync with Xero accounting software you can be assured that you have the most user-friendly approach to your disbursements, client accounting & VAT submissions.
It is important to note that the rules around VAT are not changing, it is only the submission of VAT records which is changing. This change will only affect businesses with a taxable turnover above £85,000.
Since MTD is aimed at making filing tax simpler for businesses, this opportunity should be considered by all businesses, so you can enjoy the simplicity and efficient of online accounting.
InTouch is already prepared for this
Every Office & Client transaction is digitally linked to your Xero transaction.
The scheme requires online tax filing and payment, as well as digital record keeping. All business taxes will be part of the scheme, but so far, only Making Tax Digital for VAT has a roll out date which is mandatory from the 1st April 2019. You must start following MTD rules from the first day of your first VAT period that starts on or after 1st April 2019.
The HMRC state that once data has been entered into software used to keep and maintain digital records, any further transfer, recapture or modification of that data must be done using digital links.
The date and details are still to be confirmed by HMRC however, maintaining digital records and quarterly submission of income and corporation tax are expected in April 2020.
This will allow, through your digital account, a complete picture of your business’s tax affairs. The collection and processing of information will be as close to real time as possible which will help prevent tax due and repayment build ups whilst also removing the need to wait until the end of the tax year to know how much tax you owe.
