Research published by FreeAgent has found that a fifth of the smallest business are unaware of Making Tax Digital (MTD) – HM Revenue & Customs’ (HMRC) flagship policy, which will introduce quarterly electronic reporting for most businesses.
The FreeAgent survey also found that 84 per cent of micro-businesses thought the Government had not provided enough information about its plans and how they will affect businesses.
While the lack of information available about MTD was a clear cause for concern amongst respondents, 41 per cent of the businesses that were aware of MTD were positive about its introduction and 27 per cent thought it would make it easier to run their businesses.
Ed Molyneux, CEO and co-founder of FreeAgent, said: “Making Tax Digital will be one of the biggest changes made to the UK tax system for generations and will potentially start to impact businesses from as early as 2018. But although many micro-business owners appear to be positive about the proposals, it’s clear from our research that many others still require more information about what tax digitisation actually is and how it will potentially impact them.”
He went on to urge the Government to keep business owners up to speed on the changes, pointing out that, where businesses are aware of MTD, they are often positive about its likely impact.