The Making Tax Digital is now legitimately the United Kingdom’s new tax system. In April 1st, 2019, businesses exceeding the VAT threshold of £85,000 are now required to keep tax records and do tax filings digitally.
These businesses will also start complying with their tax obligations quarterly compared to the annual submission of tax reports in the previous tax system. Thus, what are the expected benefits that these businesses will get upon complying with their tax duties under the Making Tax Digital system?
Will the taxation system be the same? Or will there be a great change happening?
Since that it has been in practice in merely a month, it’s hard to iron things out if it’s going to be beneficial in general. For now, read the following and know the foreknown benefits of Making Tax Digital for VAT to UK businesses.
· Promotes effective and reasonable use of technology
Technology is known for its immense contribution to making day-to-day living a better and easier one. Also, it’s like an open book that’s accessible to all – it caters to all ages, genders and more.
Since the use of technology is uncontrollable there are some circumstances that it’s now also becoming one of the instruments to committing crimes, bullying, pornography, and even disconnecting people from reality.
With the implementation of the Making Tax Digital for VAT, the tax administration raises the flag of a responsible, more meaningful and much better way of handling technology – and how it can aid into a faster and better global development.
· Engage taxpayers to embrace the use of technology in business
The technology is undeniably in the very centre of the limelight and the highest peak of its success. Would you believe that there are still people who are puzzling about the use and purpose of technology?
It’s true that there are people who are lacking knowledge in using technology and who are completely clueless about it. And sad to say, several of them are taxpayers, accountants, and agents.
That’s why with the birth of the MTD for VAT, those taxpayers, accountants, and agents who don’t have enough knowledge using technology, will be engaged to adapt it. The new tax system will give them the urge and reason to discover technology and to learn about it.
· Delivers faster growth of UK businesses
With a more efficient, more effective, and easier tax system, UK businesses have more room for faster growth. Evidently, the MTD for VAT isn’t that complicated like the previous or the manual tax system. It won’t prolong the process of filing and/or recording tax reports.
The people involved in complying with tax obligations such as the taxpayers, accountants, and agents will now have a better way of meeting the quarterly deadlines. Moreover, the digital tax system has more options and beneficial features to make tax recording and filing faster and easier.
· A great leap to more productive employees
The previous and manual tax system made taxpayers, accountants, and agents go through sleepless nights merely looking for missing or misplaced receipts and documents. But in MTD for VAT, the processing of tax records will be highly different from the previous one – in a good way, of course.
Since digital tax system will no longer need papers, everything will be stored and recorded digitally. Which is way better and faster compared to the previous tax system.
· Lesser mistakes in recording and filing process
The digital tax system offers a more accurate and lesser mistakes services to the taxpayers, accountants, and agents. It is evident how rampant committing and finding mistakes in the previous tax system.
With that, meeting tax obligations was a stressful and hassle one. These mistakes hinder meeting tax duties on or before time which will now highly be avoided with the UK new digital tax system.
These are merely some of the game-changing advantages of Making Tax Digital for VAT not only to the taxpayers but also to the business and taxation community. Join the journey of the UK’s new digital system and be the one to tell if it’s a great help in the UK’s business world.
Kath Ramirez embraced the dream of being a writer since she was in 4th grade. She took it seriously and she’s now a graduate of AB Journalism and a current writer to Australian and United Kingdom-based companies. Aside from writing, Kath also keeps herself busy spending time with her family, cherishing the role of a mom to 3 dogs and a puppy, reading random books, and diving into the world of photography. She’s not even a pro to whatever she’s engaged into right now, but one thing she knows, she’s happy and that’s more than enough.