• Ed Molyneux , CEO & Co-founder at FreeAgent


• 24.04.2018 10:00 am
undisclosed

Making Tax Digital is going to be one of the biggest changes made to the UK tax system in history. Due to the ambitious scale of the policy, it can’t be rushed. 

What is concerning is how closely MTD’s proposed initial introduction is to the UK’s planned exit from the European Union. At the end of March 2018, businesses will face the prospect of Brexit becoming a reality, and two days later, firms with turnover above the £85,000 VAT threshold must also be ready to comply with MTD. That’s a lot of upheaval that will take place over a very short time period and will potentially affect millions of businesses.

Overall, we believe that Making Tax Digital is an opportunity for business owners to have real control and clarity over their business finances and that it will mean they are in a better position to calculate and pay their tax bills. But it is also a major piece of legislation that will have a significant impact on the UK’s micro-business sector.

The good news is that many of these micro-business owners have been well-informed about the MTD agenda and how it will impact them over the coming years. But, by contrast, they have generally been left in the dark about the Brexit process and still have little idea about the effects that leaving the EU will have on them. I would therefore call on the government to provide more clarity on its Brexit policy and to keep micro-businesses fully informed about the whole process, so they have the peace of mind to concentrate on making sure their tax affairs are in order.