Putting MTD software into place 'will cost firms an average of £564', FSB finds

11 Mar 2019

Research published by the Federation of Small Businesses (FSB) has found that putting Making Tax Digital (MTD) software into place 'could cost UK small firms an average of £564'.

MTD for VAT is set to come into effect from 1 April 2019 for businesses which have a taxable turnover above the VAT registration threshold (currently £85,000). As part of the initiative, businesses must keep some records digitally, using 'functional compatible software'. This means a 'software program or set of compatible software programs which can connect to HMRC systems via an Application Programming Interface (API)'.

The FSB revealed that 23% of small businesses have received quotes for MTD-compliant software, but are yet to make a purchase.

According to the research, bigger businesses must pay higher prices for MTD-compliant software. Firms with a turnover between £500,001 and £1 million could be landed with an average bill of £872 for MTD software. Businesses with a turnover of more than £1 million could be given a bill of £1,019.

'We're only three weeks away from the roll-out of MTD, and small businesses are clearly not prepared for it,' said Mike Cherry, National Chairman of the FSB.

'That being the case, the Chancellor must double down on his commitment to light-touch enforcement when he delivers the Spring Statement on Wednesday.

'At a time when small business confidence is in the doldrums – and wages, auto-enrolment contributions and business rates are rising – more costs and admin burdens are the last thing they need.'

Register for our newsletter

Once a month we'll send you an email packed full of essential business news and handy tax tips to help save you money.

Register

Weston-super-Mare

34 Boulevard
Weston-super-Mare
Somerset
BS23 1NF

01934 415022

Cheddar

Bath Street
Cheddar
Somerset
BS27 3AA

01934 743274


Home | Contact us | Accessibility | Disclaimer & Privacy Policy | Help | Site map |

© 2020 Four Fifty Partnership. All rights reserved.

We use cookies on this website, you can find more information about cookies here.


Registered to carry on audit work in the UK by the Institute of Chartered Accountants in England and Wales. Details about our audit registration can be found at auditregister.org.uk under the reference C001092613.

"four fifty partnership" is a trading name of Four Fifty Partnership Limited. Registered in England. Company Number 5032008. Registered Office 34 Boulevard, Weston super Mare, Somerset BS23 1NF.

Directors: Richard Acreman BSc CTA, Joy Boswell FCCA FCA, Peter Ison BA FCA and Nick Gravell FCCA FCA.

Professional Indemnity Insurers: Nexus Underwriting Limited 52-56 Leadenhall Street, London EC3A 2EB (Policy Number: BC6210PIA194). The territorial coverage is worldwide excluding professional business carried out from an office in the United States of America or Canada and excludes any action for a claim brought in any court in the United States of America or Canada.