Most umbrella contractors are by now aware of the plans to make tax digital (MTD), but some people wonder if it might be rushed.
The chair of the Treasury Select Committee has recently wrote a letter to our new chancellor Philip Hammond giving him a reminder…”It’s better to get it right than to stick to a rigid timetable.”
You know, this is exactly what I’ve been saying ever since I discovered the plans for making tax digital, as the government do seem to rush into these things without the proper thought and planning that is needed.
Let’s just say that many contractors might find themselves in a position where it is harder to do their tax, especially if the system is not finely tuned. Do the government care though, or are they just going to keep on going with their original plans? I think we all know the answer to that.
Another respected organisation, the ATT, have also mentioned they have concerns, mainly around the fact that the government were not taking enough time listening to feedback from experts.
In other words, they have decided to move forward regardless of what people think, and without any thought to if this whole “making tax digital” is going to work in the real world.
One of the main issues that has been talked about extensively is the plans to make all self employed people do their tax on a quarterly basis instead of once a year.
In theory this could have been a good idea if the whole process was really simple and it only took you 15 minutes a time, but in reality is that going to happen? I don’t think so.
It will be more time consuming if you ask me, as hard working contractors and business owners around the country will have to put time in their schedule to focus on doing tax returns 4 times a year rather than just once.
In a way, I understand the government’s reasons for coming up with this idea, as in theory it should make doing tax easier. However, they are not understanding the simple fact that most self employed people put off doing their tax for one reason and one reason only…they don’t enjoy doing it.
Now we are going to have a situation where people have to do it 4 times a year. Well, they are not all suddenly going to start enjoying it are they? Instead, it is just going to be something they don’t want to do 4 times a year now rather than just the once.
As always though, we can only wait and see what happens with this. Maybe the government will come up with something that is easy to use and makes the whole process of doing tax enjoyable. I doubt it, but you never know.