What Impact Will Making Tax Digital (MTD) Have on Small Businesses?

What Impact Will Making Tax Digital (MTD) Have on Small Businesses?

To learn more about the Making Tax Digital (MTD) initiative and who must comply – click here.

What impact will MTD have on a small business that is not VAT registered?

If you are not VAT registered and do not expect your profits to meet or exceed the VAT threshold of £85,000 by 1 April 2019, the initiative will have no impact on you for the time being.

Even if you are not affected by the 2019 MTD deadline it is a good opportunity for you to review and start digitising your business.

For example, the usual process businesses use to collect payment is; complete the job, invoice the customer and wait up to 30 days to receive payment. This method of collecting payment is lengthy and can have a negative impact on cash flow, especially if you are a sole trader or small business. Collecting payment electronically would mean you have the ability to obtain payment immediately, you could do this by buying a chip and pin device or allowing your customers to make payment on your website.

 

What impact will MTD have on a small business that is  VAT registered?

If you are a VAT registered business you will have to digitalise your accounting records before the 1 April 2019 deadline. This means financial processes, in particular, will have to be reviewed.  Give your accountant a call and ask how they are going to support you in your transition from paper-based financial records to digital.

If you need assistance in your transition to digital financial records please contact us on 01295 477 250 alternatively you can email hello@progresswithassureuk.com.

 

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