Though there might be some serious efficiencies to be gained from the introduction of the Making Tax Digital scheme (between £1.7 and £1.8 billion each year as per the government’s Digital Efficiency Report), HMRC has acknowledged that some of your individual and business clients will be exempt as they cannot transact online.
As per the Government Digital Inclusion Strategy published in December 2014, there are 3.5 to 4 million people that “may never have basic digital capabilities”. The main reasons for exclusion include:
The above challenges that some of your clients might face can be seen in detail in the graphic below
While some of these challenges are still being considered for small businesses, HMRC has decided that if your clients fall in any of the following groups they will be excluded:
Businesses and organisations
HMRC has stated that there will be exemptions for some businesses and organisations including:
Individuals - those who may never go online
It isn’t just businesses that don’t use the internet. HMRC recognises that a minority of people can’t use digital tools.
While only 5% of the adult population do not have basic literacy skills (2.6 million people), these groups, referred to as ‘digitally excluded’ are defined as those who can’t engage with accounting software for reasons such as:
In a consultation from earlier this year “Making Tax Digital: Bringing business tax into the digital age”, HMRC suggested it will consider other exemptions on a case-to-case basis.
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Andrew is the Communications Director at Solutio (UK) Limited and carries years of experiences in the recruitment and payroll industry. Apart from work, he also takes time out to follow his passions for music, travel, design, interiors and what he likes to call “a random array of subjects that catch the eye.” Being an avid writer, he profusely documents his experiences in his writings.