On 29th March, research by ICAEW showed that 75% of businesses in the UK weren’t doing their bookkeeping online through accounting software.
In 2 years time, as of April 2018, all small businesses will have to comply with the Government’s Making Digital proposals. When these are enforced all digital record keeping will be mandatory and 4 returns will have to be sent across to HMRC every year. By 2020 the latter will apply to all businesses.
Therefore, this new Tax Year should start to see a shift in the way businesses go about their accounting processes, in preparation for 2-4 years time.
According to ICAEW’s research, sole-traders will face difficulty as at the moment only 18% of one person businesses adopt digital bookkeeping. In fact it is thought that the construction and manufacturing industries will be affected most of all, as 41% still depend on paper-based records. Despite this, over half of those surveyed were in favour of encouraging businesses to maintain their accounts online, however only 18% felt it should be made obligatory.
Paul Aplin, the Chairman of ICAEW’s Technical Committee said “We fully support HMRC’s ambition to increase the use of digital technology to make meeting tax obligations more straightforward. These changes should however be a matter of choice for business owners and should not be made mandatory.”
Go to http://goo.gl/CvcDAn to find out more
Have a good evening