Two major forces – Brexit and Making Tax Digital (MTD) – are bearing down on the government together. It looks as if HMRC may struggle to cope in the long term.
We’ve already spoken about Brexit’s implications for the digital tax system, and what they might mean for the roll-out beyond 2020. So how can you stay confident? What can you do, specifically, to avoid any turbulence with your tax submissions?
In our previous blog post, we mentioned HMRC’s insistence that MTD for VAT is going ahead. To recap, this means that any VAT-registered business with a taxable turnover greater than £85,000 per annum must, by the 6th April 2019, start keeping digital VAT records and send their VAT Returns using MTD-compatible software. MTD for Income and Corporation Tax won’t be introduced until 2020/21 at the earliest.
Yet Brexit is piling pressure on every government department. Customs staff, visa administrators, finance experts… Many of them are in short supply. Here’s a snapshot of the problem:
At the very least, the immediate MTD infrastructure isn’t looking too solid for the 1.5 million taxpayers over the VAT threshold. At the most extreme end of the scale, we could see a large proportion of them penalised for not being able to submit effectively, or being unaware about that responsibility in the first instance.
The best way to prepare is by using software that has already been verified by HMRC for digital tax purposes. Also, a good knowledge resource is essential. Liquid fill each of those quotas – we’ll keep you updated on the government’s position, and we’ve built a platform (our VAT Filer) to input and submit details as you scale up.
A seamless conduit to HMRC will help you join the Making Tax Digital system whilst Brexit rages on behind it. Discover more about our Filer today.