Making Tax Digital for NetSuite
What you need to know about Making Tax Digital (MTD)
Making Tax Digital is a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their affairs – meaning the end of the annual tax return for millions.
Every individual and business now has access to their own personalised digital tax account and these are being regularly expanded and improved. HMRC’s ambition is to become one of the most digitally advanced tax administrations in the world, modernising the tax system to make it more effective, more efficient and easier for customers to comply.
NetSuite and Making Tax Digital
NetSuite has recently released the following slides about their solution for Making Tax Digital. The slides show how to sign up to Making Tax Digital as well as screenshots of how to submit a VAT return using Making Tax Digital for NetSuite. CLICK HERE to view the presentation slides and find out more about Making Tax Digital for NetSuite.
Four foundations of Making Tax Digital:
- Better use of information
Making Tax Digital presents significant benefits for businesses. It will mean that they will not have to give HMRC information that it already has, or that it is able to get from elsewhere – for instance from banks, building societies and other government departments.
Digital tax accounts for all will mean that customers can see the information that HMRC holds and be able to check at any time that their details are complete and correct. HMRC will use this information to tailor the service it provides, according to each of their customers’ individual circumstances.
- Tax in real time
HMRC’s customers should not have to wait until the end of the year or longer to know how much tax they should pay. HMRC will collect and process information affecting tax as close real time as possible, to help prevent errors and stop tax due or repayments owed building up.
- A single financial account
At the moment most taxpayers cannot see a single picture of their liabilities and entitlements in one place – the HMRC are changing that. By 2020, customers will be able to see a comprehensive financial picture in their digital account, just like they can with online banking.
- Interacting digitally with customers
HMRC customers (and their agents) will be able to interact with the HMRC digitally and at a time to suit them. They already have access to a digital account which will present them with an increasingly personalised picture of their tax affairs, along with prompts, advice and support through webchat and secure messaging.
Making Tax Digital for business
HMRC’s ambition is to become one of the most digitally advanced tax administrations in the world, modernising the tax system to make it more effective, more efficient and easier for customers to comply.
A modern tax system, based on digital technology will make it easier for businesses to get their tax right. Reducing the amount of avoidable errors will also reduce the cost, uncertainty and worry that businesses face when HMRC is forced to intervene to put things right.
The logic of digitising the tax system is widely recognised and millions of businesses are already banking, paying bills, and interacting online. Digitising routine business tasks such as record keeping is the next step and is one many businesses have already taken.
The benefits:
- De-stressing tax
Businesses will submit tax data every three months, which means they can forget about cramming twelve months of work at the end of their financial year
- Far less paperwork
Computer software will make an automatic record of money coming into and going out of your business. The business (or their tax advisor) will just check the data and update it to HMRC each quarter.
- Fewer surprises
Because tax will be calculated quarterly, there’s far less chance of a big bill building up. Businesses will find out what their tax liability is every few months so nothing gets out of hand.
- More chances of lowering your bill through tax planning
Businesses that keep regular tabs on the tax they owe can make strategic decisions to lower their bill. They might make more retirement contributions or reinvest in the business, for example.
The negatives:
- Compulsory use of technology
By making tax digital for businesses, the HMRC requires businesses (or their tax advisor) to submit returns online, through either an HMRC app or online accounting software.
- More reporting deadlines
While VAT returns were already submitted quarterly, income tax and corporation tax weren’t. After Making Tax Digital takes effect, however, the single annual filing for income tax and corporation tax will be supplemented by four quarterly reports.
- Loss of privacy
Businesses may not be comfortable that some of their electronic transactions will be visible to HMRC. Businesses will be able to review the data and fix mistakes before it’s submitted.
Next steps
Businesses shouldn’t think of Making Tax Digital as just another obligation. This is the opportunity to regularly check income, expenses and profit – which will help businesses make better decisions.
- When should businesses start to Make Tax Digital?
You can make your tax digital right now, if you like, and there’s no reason to wait until the last possible moment to do it. But you need to know when it will become compulsory for your business. For more information on this visit the Gov.uk website
- Simplify your complex online accounting software
You don’t have to use online accounting software to comply with Making Tax Digital, but it might make things easier and it will give you access to other powerful tools.
Nolan Business Solutions are part of the HMRC Developer Hub, and we will be closely monitoring the development of Making Tax Digital to assist with enabling solutions for businesses.
- Making Tax Digital could be really good for your business
Change can often seem daunting, especially if it requires you to adopt new technology. However, quarterly tax filing could actually lessen your workload. And by updating your accounts more often, you’ll be able to react faster to opportunities and threats in the business.
Nolan Business Solutions are specialists at implementing CRM and ERP solutions to help businesses gain greater control over financials, inventory and operations. We also have vast experience with consulting and training businesses to improve system adoption.
View our Making Tax Digital guide - Making Tax Digital pdf
For information or guidance on any of the above, get in contact with one of the team at Nolan Business Solutions who will be able to help you and your business Make Tax Digital.
Email: info@nolanbusinesssolutions.com
Phone: 01252 811 663
About Nolan Business Solutions
Nolan Business Solutions is an international solutions provider which delivers software solutions to mid-market businesses. Focussed on industry leading CRM and ERP solutions, Nolan Business Solutions supports its customer’s growth with flexible, scalable and intelligent solutions implemented and supported by experienced consultants.
With an expert development team, Nolan Business Solutions also create innovative and popular SuiteApps and customised development services to those with more complex needs.
Nolan Business Solutions have delivered real benefits to over 2,500 customers worldwide through software, professional implementation and outstanding customer support.
