Good news that tax digitisation deadline pushed back for some – but delay should be expanded to all businesses

  • 37% of UK businesses surveyed not familiar with Making Tax Digital regime at all 
    HMRC has confirmed that the April 2019 deadline for the new Making Tax Digital regime for VAT has been delayed for some businesses, including charities, larger companies and public bodies.
We welcome the deadline being pushed back to give more time for businesses to prepare, but adds that the delay should be expanded to small businesses.
Small businesses are still expected to have all their tax processes digitised by April next year. however, results from our recent survey found that 37% of UK businesses are not familiar with the new regime at all.
Additionally, 64% of businesses say they are not prepared for the new regime, and 48% of the businesses have no plan in place at all to prepare for MTD.
The Making Tax Digital (MTD) regime makes it compulsory for businesses to digitise their VAT records and file returns directly to HMRC electronically. Through MTD, HMRC aims to eliminate manual intervention on VAT processes to reduce human error and increase tax take.
Nick Warner, VAT Partner, says: “Businesses swamped with preparations will welcome the delay to the deadline - but HMRC should be extending the deadline for SMEs too.”
“Many SME businesses have not even started the complex process of digitising all their tax processes and upgrading their software and systems with less than six months to the deadline.”
“Complying with VAT regulations is a huge burden for many businesses, which have had little to no support or guidance on how to implement MTD. The added task of meeting these requirements is only adding to existing stresses such as Brexit.”
“Anything HMRC could do to simplify the VAT regime would be highly beneficial to businesses.”
To discuss any of the detail around this announcement, please contact your usual Moore Stephens adviser.

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