Every business is accountable to pay and meet their tax obligations to avoid being charged by the law. That’s why the United Kingdom’s non-ministerial department, known as Her Majesty’s Revenue and Customs or HMRC, created an initiative to finally bring out an idea for an “end of tax return” and to break the ice to deliver a “transformed tax system” in the year 2020 – the Making Tax Digital.
The MTD is expected to fulfill the HMRC’s ambition to be one of the most digitally progressive tax administrations in the world.
However, this article only gives highlight to the advantages of one of the MTD’s features, the MTD for VAT. Learn more about it and be inspired by the smart and innovative move of the UK’s HMRC.
1. Reduces loads of paperwork
One thing that businesses benefit from the MTD for Vat is that it makes the filing much better, faster, and easier. A company must have its respective accountant or bookkeeper but they wouldn’t want to get stuck in a pile of paper works.
If a company is MTD-compliant, money is automatically coming in and going out of the business. The filing process is reduced and made far way better than the traditional or the manual tax system. That means that MTD for VAT delivers help to slowly eliminate tons of paperwork, and also reduce the use of papers in the workplace.
2. Much more accessible
Since there is bridging software or accounting software available, complying with tax obligations is much easier and more accessible this time. The MTD for VAT would be easier to reach or access by the taxpayers and there would be a lesser possibility for late submissions of the tax obligations.
By choosing the right accounting software of bridging software for MTD for VAT, meeting the tax duties would be a hassle no more. No taxpayers would want to be bombarded with lots of offices works together with the headache of complying with their tax obligations on time.
3. Boosts productivity
With MTD for VAT, the company will more likely boost the employees’ productivity. Of course, it’s because there is lesser paperwork, reduced filing and/or checking of tax returns, and more time to give for other pending tasks.
Though some may have difficulty in coping up or adapting the new tax system and its features, a majority are looking up to it as a great innovation since everything is going digital so why not include the tax system, right? Moreover, it’s expected to make every taxpayer’s work easier when meeting their tax obligations.
4. Better manipulation
With lots of papers for the filing and completion of tax obligations, this could cause either chaos on the accountants’ or bookkeepers’ desk or too much pain in their heads. The MTD for VAT has better and easier to manipulate the type of features that will really lighten loads of both the taxpayers and the accounting staffs who file the papers.
Accounting staffs will no longer experience a late night at work or the need to bury their heads on their paperwork will never be needed again. Because the MTD for VAT will bring on the table the service and the help that every accounting staff and taxpayers have been searching for a long time.
5. A way better and smarter system
The initiation of MTD for VAT offers a way better and smarter system than the previous tax system. The companies or taxpayers will no longer need to hand over information that HMRC can acquire from other sources, like banks and other government sections. And that makes the process for the taxpayers or the businesses much easier.
Since, that the MTD has not been in a proper practice over the United Kingdom’s tax system, it’s still under the observing eyes of the UK’s tax administration. Will it be able to deliver a more efficient, more effective, and easier tax system as it desire? Or will it be able to offer the kind of help that every taxpayer has been longing for a century or so?
No matter what the MTD for VAT will result in, it still considers as a great innovation and initiation done by the UK government’s HMRC. As it will raise a flag that is a much better tax system to help both the tax administration and the taxpayers.
