Now that Making Tax Digital (MTD) for VAT has been in place for over 18 months we could be forgiven for thinking the period of transition to digital bookkeeping had passed. However, I think we have only just begun.
With the MTD programme due to be extended; firstly to all VAT-registered business in 2022, followed by MTD for income tax in 2023, more and more businesses will need to review their existing bookkeeping processes and consider digital solutions.
Moreover, some of the government support schemes made available as a result of the COVID-19 pandemic require detailed management accounts. The rock bed of management accounts is up-to-date bookkeeping records. Digital solutions are very useful in achieving this, for example by using open banking feeds.
Earlier this year I supported a small limited company through the transition to Xero. This helped the directors to achieve MTD compliance as well as application-ready management accounts. To keep the process as painless as possible I used MoveMyBooks to transfer their existing bookkeeping data to Xero. As a result the transition was swift and hassle-free, and we had one very relieved and satisfied client.
Following this, we have been able to prepare the financial statements and corporation tax return promptly after the year-end. We now have regular catch ups with our client to hear how things are going for them and to advise on the business’s performance. By using Xero we’re reassured that it reflects a live snapshot of the company’s financial position and helps them make informed decisions about their business.
Please see our Making Tax Digital guide for further information
If you would like to speak to a member of our team about the many benefits of cloud accounting please contact us.