Welcome to the 21st Century – digitising your business
5th October 2021
I’ve no doubt that there are companies in this country who still have a preference for paper bookkeeping but, depending on what type of company you are setting up and what turnover you will have, the move towards digital is inevitable.
Making Tax Digital
The UK Government started their ‘Making Tax Digital’ programme in April 2019, requiring VAT-registered businesses to keep tax records in digital format and to use software to submit their VAT returns by April 2022. They have recently stated that this will also come into force for self-assessment for April 2023 (with a turnover of above £10,000) and includes quarterly reporting as well as a year-end declaration.
What does that mean for your start-up?
Planning your approach to digitisation will be easier if you start off your business with good software. There won’t be any late filing penalties for at least a year as everyone gets used to the new system. However, if you are starting your business now, with digital capability from the outset, you will already be ahead of the game.
Although it’s not my intention to recommend any particular software on this blog, I do know that there are quite a few packages out there and a simple internet search will come up with a long list. Whichever one you choose, make sure you have researched it thoroughly, so it meets your business requirements, now and in the future. Grant-Jones Accountancy can give you specific advice on software once we know what you need and help you anticipate what you will need as you grow. Changing your software at any time to accommodate your growing business is much harder than paying for a comprehensive package that is future-proof.
Role of your accountant or bookkeeper
For those of you who get excited by apps, many software companies have developed apps which link to your accounting, so much of your invoicing, debt chasing and bank reconciliations can be automated, saving your bookkeeper or accountant hours per month.
Don’t underestimate the time it takes to learn the software you will be using. If you have grown up using tablets and computers from an early age, this will of course come easier to you. No matter how tech-savvy you are though, always make sure, as the business owner, that you understand the software and know it’s capabilities. That way you can oversee and mentor an in-house bookkeeper and be able to use it if necessary. It takes time but the benefits are massive so it is worth the investment.
Want to know more about starting your business the digital way? CLICK HERE to download my book, The New Business Kit today.