2017 will see the biggest shake-up in tax return reporting since the introduction of self-assessment as the government finally publishes proposals to make SMEs submit their quarterly tax return online. The measure is set to be clarified by government in 2017 as part of its programme to ensure that all tax matters become paperless and move online by 2020.
Making Tax Digital will have a significant impact on the SME community as they will no longer be able to leave tax matters to the end of the financial year. Worryingly, many do not know about the proposals and have not started to make plans to mitigate the impact on their businesses.
The proposals will see quarterly online reporting in addition to year-end tax return declaration as well as record maintenance via HMRC-compatible software only.