Small businesses 'not ready' for Making Tax Digital, survey finds

21 Feb

A survey carried out by the UK200Group has suggested that many small businesses do not feel prepared for the introduction of the government’s new Making Tax Digital (MTD) initiative, which is due to be implemented between 2018 and 2020.

The measure is intended to create a ‘transparent and accessible tax system fit for the digital age’.

The UK200Group found that 65% of firms currently do not make use of accounting software.

It also discovered that 22% of small businesses still keep their records manually, while 27% use basic computer programmes such as spreadsheets for their bookkeeping.

The Group notes that these firms will be required to ‘adopt a full accounting package to make them compatible with the Revenue’s plans’.

Richard McNeilly, Chair of the Digitalisation Taskforce at the UK200Group, commented: ‘MTD represents the single most significant change to the UK’s system of taxation in recent times, and many of our smaller business clients are simply not ready for it.

‘If the Revenue stays committed to having businesses report and pay tax digitally by 2018, small firms have only a short time to update their systems.’

acca logo

CHARTERED CERTIFIED ACCOUNTANTS

We are registered as auditors and regulated for a range of investment business activities in the United Kingdom by the Association of Chartered Certified Accountants – the global body for professional accountants.

NEWSWIRE

Register to receive our monthly Newswire once a month and we'll send you an email packed full of essential business news and handy tax tips to help save you money.

REGISTER NOW