No one likes the admin involved in filing taxes, with roughly 7% of people missing the selfassessment deadline each year. The Government has even considered introducing a points system similar to the driving offences model, to deter serial late payers.
Most people would agree that tax can be a headache when it comes around. But what if it was something you didnt even notice? 2020 is hopefully going to be the year that UK businesses feel a lot more clarity around their accounts.
Largely because accounting is evolving, and everything from bookkeeping to paying taxes has changed dramatically in the past 5 years. Thanks to digitisation bookkeeping is faster, more streamlined and less frustrating, which means accounts can be closer to real-time and taxes can be submitted directly.
There are several factors to back this up, from the UK Government’s efforts to digitise tax across the country to the array of sophisticated accounting tools and services available today.
1. The Government are getting on board
The biggest and most important change to tax protocol in decades was Making Tax Digital. Despite a few hiccups during the rollout process this year, HMRC is ironing out the kinks now. When they do, MTD should be a marked improvement on the old system.Businesses that embrace MTD by moving to a digital accounting and bookkeeping solution will quickly discover the benefits and should be more on top of their finances as a result. The digitisation of tax puts an end to the crude receipts in a shoebox? approach, improving accuracy, speed, as well as automating a lot of the most painful parts of VAT.
2. The rise of next-gen accountants and bookkeepers
it’s not just the tax process that’s changing, accountants and bookkeepers are changing for the better too. The digitisation and automation of bookkeeping mean they can spend less time on compliance and more on presenting the numbers in a useful way. In addition, theyll have more time available to help clients with tough decisions and creative problem-solving.
What’s more, is that progressive accounting firms have been taking a leaf out of the advertising or digital agency playbook. Trends have led them to be more proactive in their client communications and encouraging two-way feedback.
3. There are better tools and services
The rise of cloud-based accounting services isnt just a time saver, it means accountants and business owners are armed with more powerful reporting tools to do financial tasks more effectively. These intuitive tools can also be used to create boardroom-ready presentations and charts in a click of a button, rather than spending hours in Excel.
Having such quick and easy access to fully visualised financial data will help any business owner report to key stakeholders. However, it is especially valuable for start-ups and high growth businesses seeking new finance who need to quickly demonstrate financial projections and ROI to potential investors.