One in four decision makers working for small and medium-sized enterprises (SMEs) say they believe that Making Tax Digital (MTD) will have a “positive impact on their business in the long-term”, the Association of Accounting Technicians (AAT) has said.
As of today (1 April), MTD for VAT (MTDfV) comes into force for VAT-registered businesses with VAT taxable turnover that exceeds the £85,000 compulsory VAT registration threshold; meaning those businesses will need to keep records digitally and submit all future VAT returns using MTD-compatible software.
Only 16% believed it would have a negative impact, while nearly half (46%) said it would make no difference. However, over one in ten (11%) SMEs called themselves “very or extremely unprepared for the new scheme to come into force, while around one in seven SMEs (15%) didn’t know how.
Brian Palmer, tax policy expert at AAT, said: “HMRC believes that when Making Tax Digital has been fully rolled out, it will ultimately make complying with tax return filing obligations easier for small businesses individual taxpayers and even HMRC itself.
“The launch of MTDfV is merely the first step along the road to HMRC achieving its ambition to completely digitise the UK tax system. I believe that the real benefit to business arising from digital accounting will be access to near limitless real-time information at the press of a button. This will empower businesses and tax payer to proactively plan their finances more effectively in the future.”