Making Tax Digital: How health and social care organisations can be compliant
A wide variety of health and social care organisations need to comply with the Making Tax Digital reforms. The reforms currently only impact organisations that pay VAT over the threshold level of £85,000 – and if this applies to your care organisation, then it may well affect you.
You now have to submit all returns digitally and need to do it through software that links up seamlessly with HMRC’s systems to minimise the risk of mistakes. Here is more information about the Making Tax Digital reforms and how health and social care organisations can ensure compliance.
What is Making Tax Digital?
As of now, Making Tax Digital is open to any health and social care company and any organisation that is not in VAT arrears. Making Tax Digital (MTD) is a system from HMRC that has transformed the UK tax system, making it fully automated, digital and online based. Starting with businesses above the £85,000 threshold, there is now a requirement to digitally record and submit tax returns online, and to ensure that the digital journey of data from accounting and invoicing systems used in the process of filing your return, remains uninterrupted.
Is it just for businesses?
The idea that Making Tax Digital only affects private companies is one of the myths about the reforms. As Accountancy Daily has pointed out, a whole host of different organisations fall under the Making Tax Digital umbrella, including some organisational structures that provide health and social care services. These include public bodies, for example, and charities. If your care organisation is a private company using a model such as a partnership, then that also comes under the umbrella.
How can health and social care organisations ensure they are compliant?
Some health and social care organisations have not fully digitalised yet. Often, this is down to underfunding or cultural reasons, such as staff seeing their work as a vocation rather than an opportunity to make a profit. Perhaps the main way in which health and social care organisations can comply with the Making Tax Digital regulation, then, is by ensuring that either they or their accountants have fully compliant accountancy software in place. Access Digital Tax is set up to deal with the transition, as our software is fully compatible and recognized by the HMRC thanks to integrated data and digital linking capabilities.
As a significant change designed to cut down on the billions of pounds’ worth of financial losses that the Exchequer faces every year, the Making Tax Digital reforms can cause finance officers and other team members in health and social care organisations to worry about whether they are acting within the law. However, relying on HMRC recognised systems can give you assurance that you will have coverage.
Find out more about why Access Digital Tax might be right for you in the Making Tax Digital age
