BUSINESS
HMRC has emphasised a light touch
to enforcement of MTD which simply
encourages procrastination. Since we
will all have to comply eventually, it’s less
work to do it once and to do it properly.
Given the approach being taken to
MTD for VAT, it has to be said that full
adoption of MTD is likely to go on over
a period of several more years. But as
the CEO of a software company that may
well benefit from MTD, you should treat
my words with a degree of cynicism.
Unless MTD is abandoned, about the
only thing that you can say for certain
about MTD is that software companies
are going to do well!
When will MTD for profit
and loss arrive?
The Making Tax Digital program has
already been delayed several times and
the delays have already added up to
years. At the time of writing, MTD for VAT
is being implemented, but there are still
hundreds of thousands of businesses to
come onboard.
Because of the slowness of the MTD
for VAT rollout, HMRC made a last-minute
compromise by allowing “bridging
software”. This allowed data to be put
into MTD in a similar way to the current
web form. HMRC will need to disallow
this to get the full benefit of MTD for VAT
but with many companies opting for this
approach, there is actually still a major
adoption curve to come. The truth is that
MTD with bridging software is MINO –
MTD in name only.
Because of delays with MTD for
VAT, MTD for profit and loss has been
delayed. This seems sensible and we
will probably have a better idea whether
there will be further delays once both
MTD for VAT and Brexit have passed.
MTD has already suffered from the
diversion of resources to Brexit.
So, the answer to the question of dates
is that MTD for profit and loss will arrive
by 2021 “at the earliest”.
The attitude of the
accounting profession
I regularly read comments on
accountant’s forums discussing Making
Tax Digital. It has been amazing how
negative many of them are. I guess that
this illustrates how much resistance there
is to change. Naysayers have dominated
the discussions. But it was interesting to
see the comments that came back when
one accountant recently stated that they
were thinking of non-complying. That is
because so many people had said how
difficult it was. Following this there was a
flurry of accountants saying that they had
got their clients up and running on MTD
for VAT with no problems.
In summary
Computerising business records and tax
returns has got to be good news if we want
rising standards of living, which in turn
depend on improving business efficiency.
However, there are a number of
mountains to climb before everything
is fully up and running. HMRC have not
really distinguished themselves with
the professionalism of the programme
so far. Here’s to hoping that they will do
better in the future and that we can all
eventually prosper as a result.
About the author
Benjamin Dyer is CEO and co-founder of
Powered Now. Powered Now’s mobile app
aims to take the pain out of paperwork for
electricians, gas engineers and builders as
well as other trade businesses.
www.powerednow.com
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