A new survey of self-employed workers and business owners suggests that only six per cent are aware of the Government’s imminent Making Tax Digital (MTD) project – which will make quarterly digital reporting mandatory for the majority of businesses.
This lack of awareness comes despite the fact that the project, which HM Revenue & Customs (HMRC) has said will see the end of the traditional tax return as we know it, will force self-employed individuals to be among the first to adapt to an ‘all-digital’ tax system from next year.
Under current proposals, the Revenue will roll out MTD for landlords and the self-employed in April 2018, shortly followed by small and medium-sized enterprises (SMEs) and larger companies.
Many sole traders, small businesses and self-employed individuals are expected to need to completely change the way that they keep financial records in order to comply with HMRC’s tax systems overhaul.
Yet a recent study carried out by 1Tap Receipts suggests that as many as 94 per cent of self-employed business owners have never even heard of MTD – highlighting the need to seek advice sooner rather than later to ensure a smooth transition to the new tax system.
The same survey found that more than half (55 per cent) of self-employed workers dislike the current self-assessment process – suggesting that, for some self-employed business owners, the shift to MTD may be welcomed as a positive change.