You may be wondering what Making Tax Digital means to you, and more importantly, how much will it cost your business.
At Robson Laidler we are already taking our clients through this digital accountancy revolution and are already filling VAT and Tax returns online directly through our preferred partner Xero.
People automatically think because something is new it will cost them more but that isn’t necessarily the case.
Here are some cost options to consider:
1. Online accounting software costs
Making Tax Digital means that is it now mandatory to file your tax returns directly form your accounting software. HMRC’s online portal will be obsolete very soon for business with over £85,000 turnover.
We are a Platinum Partner of Xero – but other software is available.
There are free accounting packages out there but you need to consider whether they have all the features and functionality that you need. Here’s a list of HMRC’s approved MTD software, which is a good starting point.
Xero has a range of subscriptions, starting at £5 plus VAT for people who purchase through an approved Xero partner like ourselves.
For the Starter pack which allows you to send up to 10 invoices per month.
Xero Standard is £22 plus VAT and has unlimited transactions and users but if you need multi-currency functionality the Xero Premium is £27 plus VAT per month, which is ideal if you trade outside the UK.
2. Receipt capture software
You may also wish to take advantage of receipt capture software, which is a huge timesaver. We are big fans of Receipt Bank which lets you snap photos of receipts and invoices, to be pushed across to Xero. Subscription costs start at £10 per month for every 50 invoices. More info here on Receipt Bank’s pricing, but do come to us, as we can look at discounts and make sure you are using in the best possible way.
3. Moving from an old record keeping system to an online record keeping system
This could be a big move, depending on what your current process is, and where you are in your financial year. It makes sense to start a new system at the beginning of your financial year, however if this isn’t possible, due to timing, don’t worry, we know what to do to make it work. We can transfer older data or discuss alternatives. But bear in mind, Making Tax Digital is coming into force April 2019, so you need to make the change now!
Our conversion and training packages start at £500 depending on the complexity of the records and how quickly you and your team grasp it.
For this you get our team of accountants with expertise in this area who will ensure the process is as quick and painless as possible to not interrupt your work flow.
In some cases there may be resistance from others so a free demo is provided or a 1-hour workshop to help change the mindset of the other senior members of the team for £200 with a no progress no payment guarantee.
If you’re a new client to us, we will also perform a Health Check of your Xero data, that has come across from your desk top software. There’s a one off fee of £250 plus VAT for our Health Check, but if there’s nothing to adjust, this fee will be credited against our next invoice to you.
4. Regular book-keeing and submissions to HMRC
You may want to maintain your records yourself or employ us to manage your bookkeeping and VAT submissions.
If you are thinking of the DIY options, please consider these:
- It isn’t really cost free – think of the time that could be spent on other things like actually running your business, making your products, giving customer excellence etc.
- You want to ensure that you have a fabulous start to your new online processes. This could mean paying an expert like ourselves to get it right for you.
Our bookkeeping starts at £50 per month based on up to 30 purchases and 30 bank transactions per month and us doing it quarterly.
All based on transaction volume and frequency. If you want more than compliance we can offer this service daily, weekly, 2 weekly or monthly, whatever suits your needs. Monthly is the most popular option.
5. What other costs could there be?
This will be down to you and what you need but here are some things to thik about.
- New laptop – especially if you only have handwritten records
- Smartphone / tablet (we can help with financing this) – Xero and Receipt Bank both have apps as does RL and most banks
- Internet access – usually a monthly fixed fee but shop around
- Mobile phone contract
6. What it will save.
- The biggest saving is time. We have the ability and technology to take everything off your hands, however the best approach is for you to still do your own quotes and sales invoices through Xero.
- Worry – having us at hand all of the time with all your financial data, any questions we are just a phone call or message away.
- Stress- once a quarter/year you normally rush around trying to find invoices, bank statements and other docs for a VAT or tax return. This allows all of that data to be stored instantly and in most costs automatically too.
- Data security – backed up in the cloud, no loss of server data. All updates done instantly without you having to wait hours for it.
Hopefully the above has given you some idea about how much Making Tax Digital will cost you. In most cases, particularly when going from desktop to online, going digital actually makes you savings!
For more information please contact our Cloud Client Manager Nick Wilson on 0191 281 8191 or email him: firstname.lastname@example.org