Not four returns a year?
Making Tax Digital
WE NOW HAVE more detail on the
£1.3 billion plans by Her Majesty's
Revenue & Customs (HMRC) for
"Making Tax Digital."
After a Parliamentary Petition
calling on the Government to "scrap
plans forcing self-employed and
small business to do four tax returns
yearly" gathered 103,000 signatures
in five weeks, the government responded
at the beginning of January.
HMRC's old-school analogue head office
The response sought to reassure
petitioners that Making Tax Digital,
which was announced in the March
2015 Spending Review, would not
mean "four tax returns a year," which
initially seemed to be on the cards.
The self-employed will instead
be expected to provide the HMRC
with "quarterly updates", which will
be "largely be a matter of checking
data generated from record-keeping
software or apps and clicking 'send'."
Unspecified "software or apps"
are mentioned, which it is claimed
will make it an easier, "light-touch
process," they assure us.
We still don't know the scheme
will finally turn out.
So far it seems to be based on the
assumption that the self-employed
are all registered as companies and
all do our own VAT.
It also assumes all freelances do
our accounts and banking online and
we are all happy to use potentially
risky internet-based "cloud accounting"
systems, exposed as they are
to security breaches, fraud, and to
disasters involving government IT
projects. Watch this space.