As you are aware, in December last year HMRC announced the new ‘Making Tax Digital’ scheme. Both individual and business tax payers will use personalised digital tax accounts by April 2016. This will result in quarterly tax submissions, which many businesses will see as a burden on their current resources. There remains considerable uncertainty over how it may operate and the consequences of any incorrectly submitted data.
On Monday the 25th January, Parliament rapidly scheduled a debate (which lasted over 3 hours) to address the concerns raised by over 100,000 British businesses over the upcoming changes to tax filing. Quarterly tax filing will affect all businesses – particularly a good number of small and medium businesses – and so affecting members of BASDA as well as many members’ customers.
These businesses may not have the skills, time or resources to submit quarterly and the system is likely to cause significant challenges for seasonal businesses. BASDA – the voice of UK Business Software Developers- has provided small businesses with a voice in these issues with the aim of implementing real change.
Chair Confron
ts HMRC Executive
Kevin Hart, Chairman of BASDA, has attended several sessions with HMRC. In regards to these sessions he commented that, “We have been voicing notable concern for a good number of BASDA members and the wider British businesses whose success are the lifeblood of British economy. Their success is fuelled, in part, by our members and therefore all are stakeholders in this cyclical economy. Whilst compliance is a key component in our members’ propositions it’s crucial that such solutions aren’t directed by government to impose additional burden, cost and distraction”.
BASDA supports of the concept of digital tax accounts, particularly so with the provision of APIs to interact with these tax accounts and wider HMRC services, as BASDA has lobbied for APIs for a number of years. However, BASDA has major concerns about quarterly submissions and all the outstanding issues surrounding this plan. BASDA will work tirelessly for and with their members as well as the wider market to achieve the best outcome.
There is also a matter of HMRC’s desire to align payments to such submissions. In the coming months HMRC are running a number of consultation sessions on the payments alignment, along with sessions on quarterly submissions. These are being used to shape implementation. Kevin Hart added, “please join us to have your say here and reap the much wider benefits of BASDA membership”.
19% of Micro-Businesses are Digitally Excluded
Robin Williamson of the Low Income Tax Reform Group (LITRG) says of the proposed quarterly filing:
“The danger is that there are a lot of businesses and individuals who will become involuntarily left behind. We have had a lot of feedback from pensioners who are running successful businesses who are not computer literate but keep perfectly good paper records. Some business owners have disabilities which make it difficult to use computers, or live in poor broadband areas. HMRC’s own research has shown that the extent of digital exclusion is considerable and greater than the policy makers realise. 19% of micro-businesses are digitally excluded and 42% are only digitally assisted”.
Mike Cherry, Policy Director of the FSB – Federation of Small Businesses – has also expressed notable concerns over the government’s increased burden arising from quarterly filing, suggesting that consequences could add a further annual compliance cost of some £3,600 a year to small businesses.
Kevin Hart has helped many British software businesses to start a discourse with their local MPs regarding changes that affect both their businesses and that of their customers. This has come in the form of a template statement opposing the quarterly tax filing for businesses to send to MPs. Please let us know if you’d like a copy of this statement by calling us on 01494 868030.
BASDA members are made up of core business functions such as operations, development, finance, marketing and HR, whether deployed as cloud, on premise or hybrid applications. We help businesses such as yours understand legislation changes and we support your interests through lobbying and offering a collective voice.
Our operation provides benefits for many people within it’s member’s businesses, ranging from developers to directors, product managers to marketers. One simple subscription covers all your staff.
Click here to find out how to join BASDA today.