Digital Records Will Be Compulsory!
The government intends to force all businesses, large & small, to keep records electronically. When will this happen & how should you prepare for it?
Making Tax Digital
It would be easy to read the government’s manifesto about the future of tax administration “Making Tax Digital” as merely a vague policy document. While it’s just an outline it spells out changes that will have serious consequences for many businesses.
Who Will It Affect?
Unincorporated businesses with income of £10,000 per year or more, which don’t currently use software to keep financial records, will be required to do so. It seems that companies will have to use digital record keeping no matter what the level of their income. The new regime will include landlords who receive rents etc. of more than £10,000 per year.
The good news, if you can call it that, is that the government will provide free apps to help businesses. However, reading between the lines these won’t be sufficiently comprehensive for some businesses & therefore you may have to purchase commercial software. This can be relatively cheap, less than £100 per year for a small business, but using software isn’t as simple as keeping manual records. Most require a working knowledge of double-entry accounting, which may mean having to pay a bookkeeper instead of doing it yourself.
When Will It Happen?
Although the deadline given is “by 2020” the document also says that some businesses will need to comply with digital record keeping by April 2018. It doesn’t give any clues as to which businesses the earlier date applies to.
If you keep records manually, we recommend that you start planning for the change now. Look for suitable software & someone who knows, or can learn, how to use it. If you wait for the government’s free apps it might be too late to get to grips with them in time.
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If you require more detailed information on these proposed changes & the potential impact it could have on both you & your business, then please contact us & we’ll be happy to help… Our client’s vouch for our service & we invite you to look at reviews from some of our customers on our website here, together with our featured page on ‘The Best of Thetford’ website.
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