Making Tax Digital is an initiative undertaken by the UK government with the aim to create an efficient tax administration system. By making the process easier, individuals and businesses can get tax right and ultimately, put an end to tax returns for a large proportion of the UK population.
Tax returns are replaced by digital tax accounts. All tax payer details will be available in one place, just like a bank account. Individuals and businesses will be able to view their updated tax position, see tax calculations at a glance, choose payment options, edit profile information, register for new services and more.
When is it happening?
- Quarterly reporting becomes mandatory for all VAT-registered businesses with a turnover above the VAT registration threshold (£85,000).
- It is optional for VAT-registered businesses with a turnover below the VAT registration threshold (£85,000).
- Quarterly reporting becomes mandatory for income and corporate taxes (as appropriate) for all businesses (including landlords) with a turnover over the VAT registration threshold (£85,000).
- It remains optional for businesses (including landlords) with a turnover below the VAT registration threshold (£85,000).
If you are a trader based overseas, you may be able to defer compliance by 6 months. Please visit this link for more information.
What should I do as a company using Pronto Xi in UK?
From Pronto Xi 710 upwards, VAT returns can be saved in CSV or Excel file format. This file is in a format readable by the HMRC (Her Majesty’s Revenue and Customs) through a third-party intermediary, eFileReady (www.efileready.com).
To enable this functionality, please log a call via Pronto Plus or directly contact your Account Manager. The support team will install a Pronto Xi patch to facilitate your compliance process.