HMRC Changes to VAT Online Account & Self Assessment Threshold Adjustment
As a business owner, it is crucial to stay up-to-date with the latest regulations and requirements that may impact your business. HMRC has recently made significant changes to its VAT online account system, which affects VAT-registered businesses in the UK.
Transition to Making Tax Digital (MTD)
One of the key changes implemented by HMRC is the transition to Making Tax Digital (MTD) for VAT-registered businesses. This initiative aims to simplify tax processes and improve accuracy by digitizing record-keeping and filing. From 15 May 2023, businesses are obligated to maintain digital VAT records and use MTD-compatible software to submit their VAT returns. These software solutions streamline the process, reduce paperwork, and enhance tax compliance.
Self Assessment Threshold Adjustment
In addition to the changes affecting VAT, HMRC has modified the Self Assessment threshold for customers taxed through PAYE only. Starting from the tax year 2023 to 2024, the threshold has been raised from £100,000 to £150,000. This adjustment aims to alleviate the reporting burden for certain individuals, providing them with the option to file their Self Assessment tax returns using simpler methods if they fall within the new threshold.
Repayment Agent Registration
HMRC now requires paid agents who handle income tax repayments to register with them through the agent services account (ASA). This change ensures better oversight and control over the process of submitting claims for income tax repayments. By registering with ASA, agents can continue to act on behalf of taxpayers and submit claims efficiently, while maintaining compliance with HMRC regulations.
Employment Related Securities (ERS) - End of Year Return Deadline
Employers who issue employment-related securities (ERS) must take note of the revised deadline for filing their annual ERS returns. The new deadline is set for 6 July 2023, and failure to meet this deadline may result in penalties for late filing. It is crucial for employers to adhere to this deadline to avoid unnecessary penalties and maintain compliance with HMRC requirements.
Is Your Business Software-Ready?
With the upcoming changes to the HMRC VAT online account system, businesses must ensure that they are ready to comply with the new regulations. There is a significant shift towards digital record-keeping and tax filing, contact us with any questions about maintaining your digital VAT records.
