The business reporting landscape is undergoing rapid and significant change that will affect UK businesses, from GDPR’s impact on data to the evolving cloud-based technology.
The current driver is Making Tax Digital for Business (MTDfB), which will primarily impact VAT-registered businesses with a turnover over the current threshold of £85,000. However, those below the threshold can optionally undertake the process.
This is the first step of the government’s stated objective in delivering a modern, digital tax system for all businesses and their agents to get their tax right, reducing the amount of tax lost through avoidable error. Businesses will keep their accounting records digitally and will then send HMRC quarterly updates starting with VAT returns.
The first to be affected will be those filing VAT returns with effect from 1 April 2019. This means there’s just under a year to get up to speed with digital record keeping.
The advantages include:
- Those who are on cloud accounting software will be able to link directly with the new HMRC portal for the information transfer.
- Ease of access is the prime advantage of cloud accounting. Your business’ financial data can be accessed by you and your advisers from anywhere in the world.
Keeping records digitally, compared to manually, will help businesses by resulting in more timely and accurate record keeping and remove errors caused when filings are transferred from one system to another. Those on desktop software and spreadsheets will need to use bridging software in order to transmit the data.
This will eradicate manual entry of data and while HMRC are not producing the bridging software, they are expecting software suppliers to produce the bridging software for April 2019.
We are focused on helping our clients transfer from their existing non-cloud method of record keeping to a cloud package such as Xero, Sage Business Cloud, KashFlow and QuickBooks. This is to ensure regulatory compliance but also to enable us to work more closely with you on your business. Our outsourcing team assess the current record keeping, suggest which package may be most appropriate to move to, and then help with setting it up to ensure that the information is entered in an efficient and timely fashion. Our accounts team, on a monthly or quarterly basis, help to interpret and understand the reporting received from the appropriate cloud package.
You get key information for your business at a glance from a dashboard like this:
Extracting key financial information should enable you to make more strategic decisions and make improvements, to areas such as cash flow by quickly showing what you are owed. You can customise your dashboard to reflect what is important for your business. The Account Watchlist, for example, allows you to see at a glance the balances on any account you choose, whether key customers by sales or those who are slow paying – anything you want to track without having to drill down to find out how you are doing.
Please come and see us for a demonstration of what is available and how it might impact your business.
Contact Rob Stokes for more information by emailing email@example.com or call 01242 776000.