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HMRC digital timetable too short, say advisers

HMRC has such a “worryingly short” timetable for its digital tax plan that it would be wise to delay it by 12 months or possibly longer, warned advisers.

HMRC revealed plans for its new Making Tax Digital plan over multiple documents and made it known that all landlords and unincorporated firms with turnover or income under £10,000 will not be required to keep HMRC updated on a quarterly basis, or even keep records in digital format.

The Association of Taxation Technicians (ATT) said that the exemption in the plan will simplify things for startup businesses, but expressed concerns over the threshold mark.

Yvette Nunn, who co-chair’s ATT’s technical steering group, said:

“Although we support the exemption, the figure of £10,000 strikes us as a very small threshold and we suggest it should at least be aligned with the personal allowance each year; otherwise, it is over-complicating tax for the very smallest businesses.”

Frank Haskew, who heads the Institute of Chartered Accountants in England and Wales’ tax faculty, believes that the exemption for firms with an under £10,000 turnover will not do much to help most small companies; most that have a turnover under that number would be unlikely to pay tax, in any case.

Whether a business falls under the threshold or not, it needs to ensure that itsaccounts are up-to-date and accurate. HMRC is constantly looking and implementing new rules and systems, and it is up to business owners to ensure that they are aware of any changes. Ideally, they would employ the services of an accountant in the Wirral to minimise the risk of any costly errors.

Posted by Louise
August 24, 2016

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