Heads up – important changes for 2020
Explore our insights into what's next for Making Tax Digital, IR35 and second property ownership.
We believe that the next decade will see many changes coming into force for both the accounting profession and business owners alike, designed to ensure enhanced compliance in many areas of general governance. Particular areas to highlight include:
Making Tax Digital
The extension of the Making Tax Digital scheme will require businesses and individuals to provide more data to HMRC on a more regular basis and will eventually cover a broader remit by introducing Corporation Tax and Self-Assessment into the scope. A more regular reporting regime will lead to the collection of taxes on a much more frequent basis. Making Tax Digital, in turn, could lead to more enquiries from HMRC due to the enhanced ability to analyse data and improved data mining methods (in much the same way as the approach that Amazon has adopted over the last 5 years to gain incredible growth and extraordinary success).
HMRC also continues to extend its IR35 legislation now targeting all contractors in all industries. This is pushing the need for individuals to consider their employment or self-employment status, which adds additional employment taxes previously forgone using closed companies.
Second property ownership
The abolition of Letting Relief, the restriction of Principle Private Residence Relief to the final 9 months of ownership and the bringing forward of the date on which any Capital Gains Tax should be paid to 30 days from completion will all mean that the market for second property ownership will take a hit from April 2020.
While these changes have important ramifications for businesses of all sizes, we’re here to smooth the path and take the stress out of these changes. The continued pace and advancement of accounting software and technology does mean that some requirements will become easier and less time consuming but it’s more important than ever that you seek the services of a good accounting firm so that together we can navigate the changing accounting and taxation environment.
Watch this space for updates and our monthly news feeds. If there’s anything on which you’d like to hear more from us, please don’t hesitate to get in touch by emailing: firstname.lastname@example.org