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The government’s vision to modernise the tax system is going to change the way we all complete and file tax returns. The number of paper returns being filed has decreased substantially over the last few years and in the latest budget steps are now been taken to “join up” the information HMRC receive.
By early 2016 it is predicted that 15 million taxpayers will be set up with digital accounts and by 2020 it is hoped that 50 million individuals and small businesses will have a digital tax account.
HMRC will gather information from employers, banks and building societies and these will link in with these new digital accounts allowing individuals and their advisers to access the information and add other income details such as trading profit/loss figures, rental figures etc . It is likely that further down the line these figures will link in from online software providers but the detail of this is not yet known.
The online system will work in a similar way to online banking, a secure environment where duplicating information will become a thing of the past.
Taxpayers will be able to let agents manage their digital accounts on their behalf and individuals will be able to access the same information as their agents.
To find out more on the subject, please contact Liz Cliffe on 01772 821021.