Making tax digital – are you ready for it?

Change is coming fast across the legal sector. Taking effect from 1 April 2019, Making Tax Digital (MTD) is the Government’s latest initiative which looks set to shake up the way legal accounts are managed in today’s digital world. 

The regulations will be introduced first for VAT processes, requiring all VAT-registered businesses with a taxable turnover above the threshold to use MTD to keep records digitally and utilise software to submit their VAT returns. While these efforts aim to make it easier for businesses to submit their tax correctly and keep on top of their affairs long term, the regulations will require many to overhaul their previous VAT processes and opt for more digital procedures, to ensure full compliance.

For many law firms time is running out, and it is now crucial that they check the status of their systems to ensure their current software has the controls in place to maintain an efficient and compliant operation. Firms that don’t ask questions of their existing supplier could be leaving themselves open to risks of falling short of the regulations or incurring higher fees. 

For example, their existing supplier could request that they change to an alternative system, almost definitely at a large expense to the business. But remaining with their existing system could mean they simply will not be compliant from the moment MTD comes into force.

In addition, many firms may not have considered the potential time it takes to implement and migrate to new software. Data migration takes considerable time and resources to make sure it’s done right, which could leave them caught out should this be left too close to the deadline. The consequences could include them having to accept a high renewal or large migration fee to remain with the current supplier, or even sign a lengthy agreement on software they are not fully satisfied with.

With the chance of increased costs looming, firms must now check their supplier’s MTD status and make fast decisions over their software if they are to adhere to new regulations and remain cost effective. Taking these steps now could help firms reap the full benefits of software suppliers which provide fast migration with full support and expertise, meeting the demands of the MTD initiative and preparing them for other industry regulations on the horizon.

Here at Insight Legal, we project manage the whole implementation for you. This includes:

• a comprehensive migration from your current software
• training for all your staff from our support and training software specialists (not a third party)
• installation and setup; this can be on a server, cloud or simply on a dedicated machine.