New study shows how cloud accounting software saves businesses “substantial time and money”
According to a major new study, published by HM Revenue & Customs (HMRC), implementing cloud accounting software could help businesses save substantial time and money.
The findings form part of new research examining the impact of Making Tax Digital (MTD) for VAT in the workplace following its introduction in 2019 and comes ahead of the tax authorities next big step in digital taxation.
The research shows that fully compliant MTD software offers many more benefits than just helping businesses meet their legal obligations in regards to the new rules.
According to the report, firms who use cloud accounting software are:
- More likely to report that the benefits of doing so “outweigh” the initial investment or ongoing costs;
- “More confident” in getting tax right; and
- Likely to report a reduction in time spent checking submissions.
HMRC also found that 69 per cent of businesses reported “at least one benefit” from using MTD, while those businesses who use fully compatible software, such as Xero or QuickBooks, are more likely to experience multiple benefits from updating their accounting system.
The next change to the Government’s MTD campaign takes place in April 2022, when MTD for VAT is made compulsory for all VAT-registered businesses, regardless of whether they are above or below the £85,000 VAT registration threshold.
More significantly, in April 2023 digital taxation will be extended to income tax for the self-employed, partners and landlords with income above £10,000. This will require those taxpayers affected to use HMRC compliant software and submit quarterly tax summaries, alongside an annual tax return.
To find out how your business can benefit from our cloud accounting services, please contact our Digital Solutions team at firstname.lastname@example.org or 01494 552100 or your usual Seymour Taylor representative today.
This blog is for guidance only, professional advice should be obtained before acting on any information contained herein. The information was correct at the time of publishing 18 August 2021.