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Family business owners, upcoming changes to VAT will affect you

It’s Time To Get Prepared

There are less than 100 working days until the start of Making Tax Digital

With only four months left until the launch of Making Tax Digital (MTD) for VAT, HM Revenue & Customs (HMRC) has finally begun sharing information with businesses about the new regime – and has even opened a public pilot. Family businesses often use a family member to deal with their accounts, particularly in the early years – someone who is ‘quite good with numbers’ usually gets charged with the task. But often, dealing with the accounts can be ‘tricky’ to say the least and regrettably mistakes are made. The new regime is by no means any less complicated for anyone who is not up to speed with all things accounting so we thought we’d give you a brief introduction on the new rules.

What is MTD for VAT?

In a nutshell, MTD for VAT will require businesses with taxable turnovers of £85,000 or more to keep digital records and make quarterly digital submissions to HMRC using ‘designated software packages’ from next April. With a move which is sure to affect a large number of family businesses, there’s no time like the present to begin planning for this new system.

 

How Can I Prepare?

As well as beginning to share information with businesses about MTD, HMRC has also opened a public pilot to help you prepare for the changes. The pilot is open to sole traders and companies that are up-to-date with VAT and who have not received a default surcharge in the last two years. Many family businesses will find themselves included in this group and it’s well worth taking advantage of any resources available at the moment!

 

What other information is out there?

Whilst accountants and professional advisers across the UK have been making clients aware of the new digital system for over two years, the nation’s official tax authority has remained fairly quiet on what has been described as one of the biggest changes to taxation in the last 70 years.

However, in mid-September 2018, HMRC finally began making businesses aware of their plans, initially posting a tweet linking to a new webpage entitled Making Tax Digital: How VAT businesses and other VAT entities can get ready.

For more information see our Making Tax Digital web page  or contact one of our MTD specialists who will discuss your bespoke MTD solution and digital transition plan.

Contact us on 0800 234 6978 or email info@lamontpridmore.co.uk

Our Sponsors

A huge thank you to all our sponsors for the Cumbria Family Business Awards 2019

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