Last week it was announced that tax returns will have to be filled out four times a year from 2020. Chancellor George Osborne described the change as a “digital revolution” for HMRC. By the end of the decade each small business will be expected to have “their own digital tax account in order to manage their tax online”
So, what will this change really mean for small businesses?
The increase in number of tax return submissions will mean more work for small businesses and a higher dependency on their online presence in general (a worrying concept for those rural businesses whose internet access can be subject to weather!).
A spokeswoman for the Institute of Chartered Accountants in England and Wales (ICAEW) said: “This is an additional burden for small businesses especially at a time when they are already struggling with changes such as auto-enrolment.”
She added: “It is already a significant burden for people to file it once a year.”
Not only does the extra work worry small businesses with few employees, but the possibility of the HMRC site crashing at the crucial point of submission will cause many to break into sweat.
Pensioners are expected to be the most affected by the switch, as they are less likely to have internet access, and often they have more complicated tax arrangements.
So, what can you do to get ready? Get tech savvy. It may be five years away, but these things are best if not left to the last minute. It always helps to communicate with other small businesses to find out the best broadband deals that will suit you.
If you know an elderly business owner, make sure to inform them! They may not be aware of the change and could need help in gaining internet access.
Last, but not least write down the dates! As soon as HMRC release the dates for tax returns make sure you get them in your 2020 diary – in business, there is no such thing as premature!
What are your thoughts on HMRC’s digital change? Leave your comments below!
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