The majority of coronavirus relief measures put in place by the government across 2020 and 2021 are beginning to wind down.

Some will continue to impact even into the coming decade, such as loan repayments.

But key offerings, such as the Coronavirus Job Retention Scheme (CJRS) and the Self-Employment Income Support Scheme, have now closed.

So, what’s left and is it necessary for your business to take any further action?

To answer that, in this article we’ve update our support timeline. We will revisit the blog in future if and when new or further coronavirus relief measures are announced.

Coronavirus relief scheme end dates – at a glance

• Self-Employment Income Support Scheme (SEISS): Applications for the fifth and final grant had to be made on or before 30 September 2021.
• Coronavirus Job Retention Scheme (CJRS): The final CJRS grant covered payrolls up to 30 September 2021. This was the final date for which employees could be furloughed. The final claim date for this payroll is 14 October 2021.
• Coronavirus loan schemes: You can apply for the Recovery Loan Scheme until 31 December 2021.
• VAT reduced rate for hospitality and tourism: 1 April 2022 is when the full VAT rate must resume; 1 October 2021 was when use of the 12.5% rate began.
• VAT Deferral New Payment Scheme: 31 March 2022 is potentially the final payment date, although it was possible to contact HMRC by 21 June 2021 to arrange a payment plan.
• Enhanced Time to Pay for Self Assessment taxpayers: January 2022 is the final payment date.
• Pay As You Grow: Repayments are likely to be made by some as late as November/December 2030.
• Tax relief for home working expenses: No end date has been mentioned.

Coronavirus relief scheme end dates – in depth

Below, you can find more details on the schemes and their end dates:

Self-Employment Income Support Scheme (SEISS)

Coronavirus Job Retention Scheme (CJRS)

Coronavirus loan schemes

VAT reduced rate for hospitality and tourism

VAT Deferral New Payment Scheme

Enhanced Time to Pay for Self Assessment taxpayers

Pay As You Grow

Tax relief for home working expenses

Self-Employment Income Support Scheme (SEISS)

This scheme has ended. The final claim date was 30 September 2021.

The original Self-Employment Income Support Scheme (SEISS) ran until the end of October 2020, at which time it had offered two grants. It then was extended several times, and a third, fourth and then final fifth grant were announced. The last of these covered the period 1 May 2021 to 30 September 2021.

The SEISS allowed those who are self-employed and who use the Self Assessment income tax system to claim grants.

It was intended to augment earnings, meaning you could continue to work and still claim.

End date

Claims for the fifth and final grant opened at the end of July 2021 and claims needed to be submitted by 30 September 2021.

What you need to know or do

The government’s SEISS website contains details of how the scheme operated and what it offered. But as mentioned earlier, it’s no longer possible to claim.

If you claimed for the SEISS grant but found your workload has “not been impacted by reduced activity, capacity or demand or inability to trade in the relevant periods”, you should repay the SEISS grant to HMRC within 90 days of receiving it.

Don’t forget that HMRC has intimate knowledge not just of your business finances but of the entire UK workforce. It knows how much you typically earn, as well as how somebody else performing your job is likely to earn.

Another thing to remember is that the SEISS grant should be declared on your annual Self Assessment tax returns, along with any other income you received from your trade.

Coronavirus Job Retention Scheme (CJRS)

This scheme has now closed.

One of the earliest coronavirus relief measures for business, the Coronavirus Job Retention Scheme (CJRS) was extended several times but ended on 30 September 2021.

The scheme allowed businesses to furlough staff in response to lower demand while being able to claim back a percentage of their usual salary for the furloughed hours/days.

Here’s what could be claimed for September 2021:

• September 2021: You could claim up to 60% up of a salary, to a cap of £1,875 for furloughed hours and needed to contribute the remaining 20% yourself to take it up to the required 80% (up to a maximum of £625). You needed to make employer National Insurance contributions and minimum mandatory pension contributions.

End date

The final CJRS grant covered payrolls up to 30 September 2021. This was the final date for which employees could be furloughed.

The final claim date for this payroll is 14 October 2021.

What you need to know or do

Submit your final claim for September 2021 on or before 14 October 2021. Note that any adjustments should be made on or before 28 October 2021. If you miss this date for adjustments, you might incur a penalty from HMRC.

Coronavirus loan schemes

As part of the coronavirus relief offerings, the government created several loan schemes to provide guaranteed loans at attractive interest rates.

These have now been closed, in favour of a single loan scheme called the Recovery Loan Scheme. This remains open until the end of 2021.

It lets businesses apply for loans from commercial lenders that are once again 80% guaranteed by the government.

Loans are available for amounts between £25,001 and £10m for term loans and overdrafts, and between £1,000 and £10m for invoice finance and asset finance.

The loans are open to almost every business type except banks, building societies, insurers, and reinsurers (excluding insurance brokers, which can apply).

End date

Loan applications close on 31 December 2021.

What you need to know or do

To apply for a loan, start by visiting the British Business Bank website to learn more about the scheme and determine which lenders are accredited as part of it.

If your usual bank isn’t on the list, you can still approach the other lenders.

Note that lenders only have a certain amount of government-guaranteed cash that they’re lending as part of the loan scheme, so it’s often necessary to shop around to find a deal.

VAT reduced rate for hospitality and tourism

As part of the initial coronavirus relief measures, the government reduced the VAT rate classification for certain goods and services within the hospitality and tourism industry.

This meant businesses could apply a reduced rate of VAT to supplies of food and non-alcoholic drinks consumed on their premises, or hot takeaway food/non-alcoholic drink, and to holiday accommodation.

In the 2021 Budget, delivered in March 2021, the government once again extended this measure.

The various VAT rates and when they can be applied are as follows:

• 5%: 15 July 2020 to 30 September 2021
• 5%: 1 October 2021 to 31 March 2022
• Standard rates: 1 April 2022 onwards.

End date

1 April 2022 is the date when the standard rates of VAT should be applied. Until then, the reduced rates can be used.

For flat rate VAT users, the rates are also discounted, as we discuss in our article looking at coronavirus measures in the 2021 Budget.

What you need to know or do

If your business is eligible, you’ll most likely already be applying the reduced VAT rate.

You should have switched to the 12.5% rate as of 1 October 2021, which might have involved updating menus or signage to reflect increased pricing, adjusting receipt printing/invoicing systems, and making changes in your accounting.

And then, subsequently, you should prepare for resumption of the full VAT rate in April 2022.

If in doubt about how the temporary VAT rates should be applied in your accounting software, speak to your accountant, tax expert or software vendor via its support helpline well ahead of time.

VAT Deferral New Payment Scheme

This scheme is now closed.

As part of the initial coronavirus relief measures, the government allowed VAT-registered businesses to defer their VAT due for the March to June 2020 period, interest-free.

The payment could be delayed until March 2021 but in the Winter Economy Plan of late 2020, the chancellor announced this payment could be spread across the 2021/22 fiscal year as a series of interest-free payments. However, this had to be approved by HMRC.

End date

You had to have either paid in full by 31 March 2021, or you should’ve contacted HMRC by 21 June 2021 to discuss paying smaller interest-free payments.

What you need to know or do

If you failed to pay in full or make an arrangement with HMRC for extra help to pay by 30 June 2021, you may be liable for a 5% penalty or interest.

If you’re unsure on this, check with HMRC for more details.

Enhanced Time to Pay for Self Assessment taxpayers

This scheme has now closed.

Previously, the government allowed people who use Self Assessment to defer any payment due in July 2020 until January 2021.

However, it was then possible to pay this bill, plus January 2021’s tax bill, across 12 months using HMRC’s existing Time To Pay facility.

End date

January 2022 is when the final payment will be made, but you needed to have applied before January 2021.

What you need to know or do

Unfortunately, it’s too late to apply to use this scheme. But it’s worth once gain mentioning that the Time to Pay scheme is always available as an option if you have trouble paying your tax – albeit at the discretion of HMRC.

Contact HMRC’s Self Assessment Payment Problems helpline and request a Time To Pay plan.

Pay As You Grow

The government announced the Bounce Back Loan Scheme (BBLS) as part of its initial coronavirus relief measures.

In addition to the extension for applications mentioned above, the government announced it would let businesses switch to interest-only payments for periods of up to six months.

Perhaps more importantly, it also said it was extending its backing of loans for up to 10 years, meaning businesses can choose to repay the loan over that period.

End date

As late as November/December 2030, if you were granted a loan on the application deadline.

What you need to know or do

If you have a Bounce Back Loan, your lender will already have communicated this to you but, if not, enquire with it.

Note that the use of Pay As You Grow will not affect your business’ credit rating.

Tax relief for home working expenses

Those who were forced to work from home because of coronavirus can claim tax relief for additional household costs.

Claims such as this have always been possible for home workers, even before the coronavirus outbreak.

In normal years, the tax relief could only be claimed if your employer required you to work from home – if your contract of employment stated that you were home-based, for example.

However, due to the move by many businesses to offer home working following the coronavirus outbreak, this relief can be used by those who work from home.

In addition, HMRC has made a concession that taxpayers can claim a full year’s relief (52 weeks) even if they were only required to work from home for as little as one day.

In normal years, relief can only be claimed for the actual number of whole weeks worked at home.

Employees who are working from home can claim the actual costs for the dedicated space they use for their work.

Calculating this can be complex.

To simplify the claim process, HMRC has published a working from home value, which it permits workers to use as the costs for working from home without needing to do any calculations or provide evidence of actual costs.

The allowance that can be claimed without further evidence was raised to £6 per week from 6 April 2020, compared to £4 a week in previous years.

If you decide to claim for actual costs, you can claim for the likes of additional costs in your utility bills, household insurance, and phone calls necessitated by home working.

Unfortunately, you can’t claim for things you would be paying in any event, such as mortgage/rent, or for your broadband connection.

Additionally, if you’ve bought equipment specifically to facilitate home working then you may be able to claim them as business expenses in the usual way on your Self Assessment tax return.

You can claim for the home working tax relief in two ways:

• Using a flat rate of £6 a week from 6 April 2020, which is calculated based on your rate of tax. For example, if you’re a basic rate taxpayer, you can claim 20% of this – £1.20 per week. Claiming this way means you don’t need to provide evidence of the extra costs.
• For the exact amount of extra costs. But you’ll need to keep the paperwork and submit a Self Assessment claim (such as receipts, bills or contracts).

End date

Sage has enquired with HMRC if there is an end date for the extension of the flat-rate scheme to cover flexible home-working following the coronavirus outbreak. We’ll update this blog with the answer.

What you need to know or do

You can claim the relief using your Self Assessment tax return.

If you don’t complete a Self Assessment form – for example, you’re employed full time via PAYE – you can still claim via the government’s website, which launched on 1 October 2020.

This will adjust your tax code, meaning you receive the relief as a reduction in the tax you pay each via PAYE each month.

Conclusion on coronavirus support

Coronavirus relief measures are now largely winding down but some, such as the loan scheme, remain available to the end of 2021.

Businesses should think about the benefits and also any issues about using available offerings at this late stage.

With other measures, such as the CJRS and SEISS, it’s advisable to check your existing claims to ensure they’re valid. It’s worth remembering that the schemes are intended only to supplement existing income that was diminished because of coronavirus, rather than to generate additional income.

Editor’s note: This article was first published on 2 December 2020 and has been updated for relevance.

The post Coronavirus financial support timeline: How you can apply and when the schemes end appeared first on Sage Advice United Kingdom.

When Making Tax Digital for VAT is opened up to more businesses in April 2022, it brings with it a new penalty regime from HMRC for individuals or businesses that make late submissions.

This new system will also apply to MTD for Income Tax when it begins in April 2024, too, and possibly MTD for Corporation Tax, due no earlier than April 2026.

Unfortunately, late submissions do occur, despite all our best efforts.

But the good news is that the new system is less severe than the previous way HMRC penalised businesses. Its goal is better behaviour, rather than simply penalising mistakes.

In this article, we cover details on HMRC’s penalties, how the system will work, and when the penalties will apply.

Here’s what we cover:

What is the new MTD penalty system?

When do the new MTD penalties apply?

How does the new MTD penalty system work?

Do MTD penalty points expire?

Can I appeal against the points or penalties for MTD?

Final thoughts: What businesses need to do

What is the new MTD penalty system?

As with other penalties from HMRC, the new MTD penalties for late submission system intends to encourage you to make timely submission of periodic tax returns, as well as the observation of what HMRC refer to as “regular submission obligations”.

Making Tax Digital for Income Tax requires quarterly updates.

This is an example of a regular obligation. In other words, this isn’t just about getting your tax return or payment in on time, as with previous penalty systems.

However, the new penalty system doesn’t apply to occasional or irregular submissions to HMRC. These will continue to be covered by the existing penalty regime.

Nor does it apply to other problems associated with submissions to HMRC, such as getting your calculations wrong and/or paying the wrong amount. All of that also continues to be covered by existing penalty systems.

The new Making Tax Digital penalty system is purely about discouraging late submissions.

When do the new MTD penalties apply?

The new penalty system applies to MTD for VAT submissions as of April 2022. This will include those businesses, such as voluntary VAT filers, who are using MTD for VAT for the first time following the requirement to do so.

In other words, there is no light touch or soft landing period for those new to MTD for VAT.

Once Making Tax Digital for Income Tax begins in April 2024, the new penalty system will apply to that too.

And then, in April 2025, it will apply to all Self Assessment taxpayers for periods on or after 6 April 2025, even if they don’t use MTD for Income Tax.

Therefore, it’s somewhat inaccurate to refer to it as the new MTD penalty system – although it’s when attempting to comply with MTD that most people are likely to encounter it.

How does the new MTD penalty system work?

Similar to speeding fines for motor vehicles, the new system is based on a points system. After a certain number of points are reached by a business or individual, a financial penalty of £200 is automatically applied.

In general terms, one point is applied each time a submission deadline is missed. HMRC will notify the individual or business at that time.

As you might expect, both points and penalties can be appealed – see below.

The points threshold for the penalty varies depending on how frequently the individual or business is required to make submissions to HMRC.

• Monthly: Five points are required for the penalty to be applied.
• Quarterly: Four points are required. Notably, this includes both VAT quarterly submissions and quarterly updates for MTD for Income Tax.
• Annual: Two points are required.

A key point to remember is that separate points tallies are recorded for VAT and Income Tax, and separate penalties could be subsequently applied.

For example, if a VAT Return and MTD for Income Tax quarterly deadline fall on the same day, an individual or business nearing their threshold for each could find themselves automatically fined two £200 penalties if they’re late with their submissions.

Points are intended to encourage compliance with submission dates, though, and so HMRC will not apply two or more points for failures occurring in the same month (or potentially within the same quarter, with MTD for Income Tax).

There are notable and potentially commonplace exceptions, though.

Here’s an example.

An individual with three self-trader businesses using MTD for Income Tax who misses the deadline for quarterly reports for all three in the space of one month will probably only get one point.

This is the case because three quarterly returns have been missed.

These are what HMRC refers to as the “same submission obligation”.

If the same individual had to submit a quarterly return for one business, an end of period statement for another, and a final declaration (for the individual, not a line of business) for a third, all in the space of one month, then this would attract three points.

This is because these are not the same kind of submissions.

Do MTD penalty points expire?

Points expire after two years, although this is counted from the month after the month in which the individual or business received the point.

In other words, this could effectively be two years and almost a whole month, if a submission deadline fell on the 1st, 2nd etc. of the month.

But points do not expire in this period if the individual or business is at the penalty threshold (that is, a £200 fine has been applied).

For those at the threshold, a period of good behaviour must occur in which the individual or business meets all submission deadlines. They must also have made all submissions that had been due in the preceding 24 months – regardless of whether these were late or not.

The required periods of good behaviour are 24 months for an annual submission frequency, 12 months for a quarterly submission frequency, and six months for monthly submission frequency.

Can I appeal against the points or penalties for MTD?

Points and penalties are applied automatically but HMRC may, at its discretion, not choose to do so. This will be in line with “published guidance” that HMRC says it will follow.

Once a point or penalty has been applied, HMRC can’t remove it unless you use the reviews and appeals process.

This can be used in any event if you wish to challenge points or penalties that have been applied.

The first stage of this will be an interview HMRC review process. Then you can then move to the First Tier Tax Tribunal if you believe the outcome is unsatisfactory.

Appeals must include a reasonable excuse for missing a deadline.

Final thoughts: What businesses need to do

Other than being educated about what to expect, there’s little businesses can do to prepare for the new penalty system apart from ensuring they’re ready in plenty of time to meet the submissions deadlines.

To ensure this is the case, you should start preparing your business processes and systems for MTD now, rather than later.

There’s no better place to start than our free MTD guides:

• A guide to Making Tax Digital for Income Tax
• A guide to Making Tax Digital for VAT
• The ultimate guide to Making Tax Digital

Don’t forget that the new points system doesn’t replace the existing penalty system, which will continue to apply in many circumstances.

The post Making Tax Digital: What HMRC’s new penalty regime means for MTD for VAT and Income Tax appeared first on Sage Advice United Kingdom.

Making Tax Digital for Income Tax has been postponed until April 2024.

Sometimes known as MTD for Income Tax Self Assessment (ITSA), it had been due to become law in April 2023 and would have affected more than four million self-employed people and landlords that have business/property income above £10,000.

The government has also announced that the proposed basis period changes and the new MTD-focused penalty system have a postponed implementation date.

In this article, we feature details about the postponement of MTD for Income Tax and highlight why business owners shouldn’t wait for the new legislation to come into force to start taking a digital approach.

Here’s what we cover:

What is MTD for Income Tax’s postponed start date?

Why has the MTD for Income Tax start date been delayed?

Have the basis period reforms been postponed?

Has the new MTD penalty points system been postponed?

Will there be an extension to the MTD for VAT deadline for those below the VAT threshold?

Has MTD for Corporation Tax been postponed?

Does the delay mean Making Tax Digital is dead?

Do I still have to worry about MTD for Income Tax?

3 reasons why you don’t have to wait for MTD for Income Tax for your business to get ahead

In summary: What does the MTD for Income Tax postponement mean for me?

What is MTD for Income Tax’s postponed start date?

On 23 September 2021, Lucy Frazer (Finance Secretary to the Treasury) made a statement in parliament that provided an update on Making Tax Digital.

At the same time, the government published legislation for MTD for Income Tax, and published a policy paper.

The headline announcements for MTD for Income Tax were:

• For sole traders and landlords with business/property income above £10,000, MTD for Income Tax now starts in the tax year beginning April 2024. Previously it had been slated to start in April 2023.
• For general partnerships with income above £10,000, MTD for Income Tax now starts in the tax year beginning April 2025. Previously, it had been slated to start at the same time as the general MTD for Income Tax scheme in April 2023. Other types of more complex partnerships (e.g. limited liability (LLPs), mixed or corporate) will follow at an as-yet-undisclosed time.

Why has the MTD for Income Tax start date been delayed?

The government says the following:

“The Government recognises the challenges faced by many UK businesses and their representatives as the country emerges from the pandemic over the last year […] A later start for MTD for ITSA provides more time for those required to join to make the necessary preparations and for HMRC to deliver the most robust service possible, affording additional time for testing in the pilot.”

It’s worth noting that the MTD for Income Tax pilot programme hasn’t changed, and people can continue to sign up ahead of time provided they fit the criteria and are using compatible software.

The postponement follows a public consultation period, and subsequent announcement of basis period reforms (see below).

The latter inspired several of the UK’s largest accountancy bodies to join forces to write to the government, saying in relation to the reforms alongside MTD for Income Tax:

“It is the view of the professional bodies representing a large proportion of the UK tax profession that these reforms are being implemented too quickly. We are greatly concerned that the current timetable puts the integrity of the tax system at risk.”

Have the basis period reforms been postponed?

Yes.

While we await the official legislation of basis period reforms, the following has been announced:

• Basis period reform will not come into effect until April 2024, with the transition year “not coming into effect earlier than 2023”. Previously the reforms had been due to take effect in the tax year 2022/23.

The basis period reforms are an attempt by the government to align business accounting periods to the tax year (6 April to 5 April).

The majority of businesses already align to the tax year, but some chose different periods for reasons such as managing tax payments more effectively.

The reforms intend to address long-running criticism of existing basis period rules but focus especially on the admin requirements introduced by MTD for Income Tax.

The administrative burden for quarterly reports for each business run by an individual is eased if all of those businesses have the same tax-year basis period.

Has the new MTD penalty points system been postponed?

Because of the postponement of MTD for Income Tax, the new penalty point system has also been postponed to that date for those that use MTD for Income Tax.

However, it will apply as of April 2022 for MTD for VAT, as originally planned.

In other words, the new penalty system will come into force as follows:

• April 2022, for MTD for VAT, alongside the expansion of MTD for VAT in April 2022.
• April 2024, for those that will use MTD for Income Tax as of the postponed April 2024 start date.
• April 2025, for all other Self Assessment individuals (regardless of whether they’re using MTD for Income Tax; notably, this isn’t new and the new penalty points system was already slated to apply to all Self Assessment individuals a year after it was introduced).

The penalty points system, once it’s implemented, means those making late submissions would earn a penalty point, rather than getting fined instantly by HMRC.

Once a certain number of points goes beyond a threshold, a £200 penalty will be automatically applied.

For MTD for Income Tax and MTD for VAT users, this threshold is four points.

Will there be an extension to the MTD for VAT deadline for those below the VAT threshold?

There was nothing in the government statement on 23 September 2021 about the final phase of MTD for VAT, which means all VAT-registered businesses must use MTD for VAT as of April 2022 (including any that have voluntarily registered for VAT yet are below the threshold).

Therefore, we have to assume nothing has changed and there won’t be an extension to the MTD for VAT deadline for voluntarily VAT-registered businesses.

Notably, legislation for this was laid before parliament on 7 September 2021, and a detailed policy paper was released, making a postponement perhaps even less likely.

Has MTD for Corporation Tax been postponed?

There was nothing in the government statement about Making Tax Digital for Corporation Tax.

However, an earlier ministerial statement reiterated that MTD for Corporation Tax will not happen before 2026.

MTD for Corporation Tax applies to incorporated businesses that, as the name implies, pay corporation tax.

The government hasn’t announced many details so far but it’s expected to require businesses to keep accounting records digitally that pertain to corporation tax, make quarterly summary updates of income and expenditure to HMRC, and submit Corporation Tax Returns digitally.

Does the delay mean Making Tax Digital is dead?

No.

The government hasn’t changed its plans for MTD. It’s simply postponed the MTD for Income Tax dates, alongside other aspects relating to this such as the basis period reform and the new penalty system.

In the parliamentary statement, the government said:

“We remain firmly committed to Making Tax Digital and building a tax system fit for the 21st century.”

Do I still have to worry about MTD for Income Tax?

MTD for Income Tax remains on the radar of a significant number of sole traders and landlords.

It’s simply been delayed by one year.

That’s not a very long time in the world of business, and the advice from experts is that you should begin digitalising your business now, if you haven’t already.

It’s vital to remember that, by requiring the use of software, MTD for Income Tax offers many benefits to your business that can be transformational.

You can reduce your admin load while gaining an edge over your competition.

3 reasons why you don’t have to wait for MTD for Income Tax for your business to get ahead

When it eventually comes into force, MTD for Income Tax will ensure more businesses are taking a digital approach to manage their finances.

But, despite the delay in the legislation, there’s no reason why your business can’t make the move to digital working now.

In fact, if you do so, your business will reap many benefits.

Here what people who have digitalised their business say are the benefits:

Always know the financial position of your business

MTD for Income Tax requires you make quarterly updates about your accounting. The goal behind this is to ensure people pay more attention to their finances.

But if you say goodbye to using paper and spreadsheets for managing your finances and move to using cloud accounting software, you can get ahead of the curve now.

By doing so, you’ll always know your cash flow position, and how much money you have to operate with.

You’ll also know how much tax you owe, so can plan better.

You won’t need to rely on your accountant for information like this – instead, they can use their time to take on an additional business advice role for you, helping to create growth for your company.

Make fewer mistakes

Using good quality software to digitalise your accounting in time for MTD for Income Tax will mean you’re more likely to get things right each and every time – and often while spending less time doing those admin tasks in the first place.

It also means you run less risk of getting on the wrong side of HMRC.

Make superior business decisions

With the use of mobile technology and good MTD-recognised accounting software, you’ll be much closer to your business accounting.

Your accounting can be accessed from your pocket, in fact – just a tap away on your mobile phone, using an accounting app.

This means you can see problems coming and take action on the fly, rather than having to sit down in an office or at home during your evenings and weekends to ‘do the admin work’.

Got some invoices that haven’t been paid when you’re expecting a large payment to go out?

You can see that as it happens and remind your creditors ahead of time, in order to avoid issues.

But it’s not just problems to stay track of. You can identify opportunities too.

You can see them arising by looking at the reports and dashboards, and spotting trends in your business.

Ever noticed that your business seems to do well at a certain time of the year? Or how certain customers provide the majority of your income? Now you can discover and make the most of these opportunities.

To be clear, there’s no need to wait for MTD for Income Tax to revolutionise your business life.

Investing today means you get all the benefits now, and are ready for MTD for it arrives – no matter when.

In summary: What does the MTD for Income Tax postponement mean for me?

The government says the following in its public announcement:

“A later start for MTD for ITSA gives those required to join more time to prepare and for HMRC to deliver a robust service, with additional time for customer testing in the pilot.”

Further to this, those affected by MTD for Income Tax now have longer to examine their processes to discover where and how the forthcoming legislation can improve the way they work.

It’s important not to let the postponement lull you into a false sense of security. If you fall within its scope, MTD for Income Tax will continue to apply to your business(es).

Two years may sound like a long time but if you have to make adjustments to your accounting (such as changing your basis period or updating your software), then these will need to be planned well in advance and could require the help of accounting professionals who are likely to be in short supply as the MTD deadline gets closer.

Those individuals that have to adjust to MTD for VAT in April 2022 will also a bit more time to make a successful jump to MTD for Income Tax – although it’s worth remembering that upgrading to good-quality cloud accounting software now means you’ll be equipped for MTD for VAT and ready for MTD for Income Tax ahead of 2024.

Editor’s note: This article was first published in September 2021 and has been updated for relevance.

The post MTD for Income Tax postponed: Everything you need to know appeared first on Sage Advice United Kingdom.

Business admin is an important part of running a business – and a key part of that?

Dealing with your banking.

Understanding your cash flow, staying on top of your income and outgoings, and sorting your invoices are just some of the tasks you’ll have to tackle on a daily, weekly and monthly basis.

But if you’re not making the most of your accounting software to manage your banking tasks, you’ll be spending more time on admin than is required.

And that means less time doing what you love – selling your products and services, finding new customers, having your evenings and weekends free to do as you please.

Instead of dedicating time to deal with data entry, your accounting software can help with your banking requirements in three ways:

• Automatically import bank transactions
• Set up reusable rules
• Streamline your bank reconciliation process

In this article, and as part of our Sage Delivers series, we’ll reveal how Sage Accounting can help you fulfil all three of these.

Here’s what we cover:

The importance on integrating banking in Sage Accounting

Putting your feedback into motion

Three ways the new Sage Accounting banking release can help save time

What do these improvements mean for you and your accountant?

Bonus stuff: More support on managing your banking

Get paid faster, track cash flow and automate admin with our award-winning accounting software to free up time so you can focus on the work that matters most

The importance on integrating banking in Sage Accounting

Banking has evolved from manually writing up receipts to an automated process triggered by a few clicks within Sage Accounting.

This has been opened up through the connection of banks, the automation of bank feeds, and further enhanced by technology such as AutoEntry to digitally capture your financial documents.

Integrating your banking into Sage Accounting means you can work more efficiently, and this will help you streamline the reconciliation of your accounts.

Having the confidence that your accounts match up is another way Sage gives you control of your business.

Putting your feedback into motion

As we continue to evolve Sage Accounting to meet the needs of your business, we’ve looked at the valuable feedback from our customers and addressed some of the most pertinent requests received.

We know you want to have the flexibility to manage your accounts in a way that works best for you – and this latest release does just that.

You can look forward to an even more streamlined bank reconciliation process.

Three ways the new Sage Accounting banking release can help save time

1. Have the flexibility to import your transactions from anywhere. Set up a bank feed directly with your bank, import your bank statements yourself directly into Sage Accounting, or with a click of a button through our exciting new integration with AutoEntry.
2. Easily set up the automation of bank rules to any of your transactions, regardless of where the data comes in from. (Unsure what rules are? Bank rules are a set of criteria that you define and are applied to incoming bank transactions. Use them with bank accounts connected to a bank feed or when you import a statement directly or via AutoEntry.) Setting up and applying rules is a great way to simplify your banking process by automating the task of manually allocating transactions.
3. You can now copy rules between bank accounts. That’s right, managing the rules once they’re set up has never been easier.  Even better, take that rule and use it on another business – or in the case of accountants, another client – saving you even more time.

What do these improvements mean for you and your accountant?

All in all, these updates give you the platform to simplify your admin and enable you to automate the manual processing of transactions – saving you a lot of time.

Bonus stuff: More support on managing your banking

In addition, we’ve created a series of useful help articles that’ll take you through all you need to know about managing your banking:

• Seamlessly create bank transactions with bank rules
• Import bank statement
• Why bank feeds can help your business be more efficient
• Bank feeds: How using Sage Accounting makes bank reconciliation quick and easy
• Bank reconciliation: This is how to save time on this vital task

No matter how you want to process your banking data, the tools and functionality in Sage Accounting will help you work more efficiently – giving you more time to do what you love.

The post Sage Accounting latest updates: Driving efficiencies through banking automation appeared first on Sage Advice United Kingdom.

Long before online project timesheets, it was common for workers to clock into time logs or time-card machines in days gone past.

More recently, you may have experienced rounding up paper timesheets and manually inputting hours in to run a report.

It’s still true that many small businesses calculate hours with old-fashioned Excel spreadsheets.

Spreadsheets possibly contribute to why timesheets have a bad rep in the HR world.

Office administrators and managers are undoubtedly familiar with the traditional manual badgering of employees to get them completed.

Many people don’t enjoy enforced timekeeping.

Why would you need to track how much time work takes you, especially if you’re doing it in such an old-fashioned way?

However, your business may have valid reasons for asking employees to keep timesheets.

If appropriately implemented, they’re an effective way of recording the time your employees have spent on a job for a defined period. Let’s explore more in this article.

Here’s what we cover:

Project timesheets vs pay timesheets

Why your business would use project timesheets

Using HR software and project timesheets

Top tips for managing tasks effectively

Final thoughts on using project timesheets

Project timesheets vs pay timesheets

In HR, the use of timesheets is widespread. They’re a helpful way of working out pay, whether contracted hours are being fulfilled, and calculating overtime.

They’re particularly common in agencies and industries, from software development and professional services to construction and architecture.

Timesheets effectively collect the information needed to cost a project accurately and bill a customer.

But timesheets are not only used to calculate pay.

In project management, project timesheets can be a great way to monitor time on specific projects and keep everything on track.

You can see how efficiently a project moves along, adjusting tasks based on timesheet data to increase productivity and efficiency without delaying or increasing budgets.

Why your business would use project timesheets

Construction is an excellent example of an industry where project timesheets come into their own.

You can track the hours your team spends on a job (which may spread out over different locations).

Here are some reasons project timesheets work well for construction jobs:

• It takes the guessing out of hours worked and they’re helpful when it comes to billing and payroll for jobs done in a specific period.
• You can increase efficiency and transparency—you can view what was or wasn’t accomplished in a specific time frame and know what you are paying employees for.
• You can quickly review timesheet information and expedite payments based on what an employee did in the work week.
• You can carefully manage the time you are spending per project, which is very useful for bidding on future projects. You can give precise estimates on future jobs, reducing the risk of overbidding.
• You can dedicate resources in the best way—better allocating a worker’s time and move tasks around on a project if necessary.

If you’re using timesheets, hopefully you’ve moved away from physical paper-based timesheets, which forces employees to fill in a form to enter their timesheet data and submit it when they’ve finished.

As well as being prone to inaccuracy (workers could put down any random number), any day an employee misses handing in a form could create problems further along, including lost payments.

Even if you’re using Excel instead of paper timesheets, you’ll understand how time-consuming it is to review each form, verify whether the data is valid, and copy it to the chosen spreadsheet.

Doing timesheets without specific cloud HR software lacks control and introduces a significant margin for error. And without some complex calculations and a thorough review, it’s tough to draw out any proper analysis.

Using HR software and project timesheets

Online timesheets with the aid of cloud HR software are a much better bet than paper or spreadsheet timesheets, as you can quickly see your team’s logged hours in real time.

You can automate your process, auto-fill forms as tasks are completed and copy recurring work.

HR software can also inform you when your team members have completed timesheets and lock them when you’ve approved them.

With online timesheets, you can better track which employees are working on specific tasks and whether the outcome is what you’re expecting.

If there appears to be an issue causing a project to stutter, you can quickly pinpoint and investigate the issue.

Online project timesheets can help with project management budgeting, as you can easily measure time and budget used by monitoring the hours employees are spending on tasks and how many resources you’re using.

Timesheet data will give you better insight, which you can use to enhance your working processes.

While you can use the information to examine which employees are more efficient in using time, you might be better off using this data to understand how much you should quote on future projects based on how many resources you’ve allocated on your current one.

Top tips for managing tasks effectively

If you’re managing a project, you can use online timesheets to identify ways to improve the way you’re managing tasks, as you can see what your team is working on at any time.

Use online project timesheets to see:

Where project expenses are going

You need to manage and track expenses to keep your project within budget. Online project timesheets will help you understand how tasks overrun the time you’ve allocated for them in real time.

Overrunning tasks will cost money, and you don’t want to deliver an over-budget project.

Additionally, project timesheets should help you create better estimates for future projects, so it’s easier to stay within your allocated budget.

What tasks members of your project team are working on

A project will have different individuals with various levels of authority doing a variety of jobs.

You need to select the best people for the specific jobs that make up your project and ensure they have the knowledge and skill to do it.

Which tasks your team haven’t finished

With project timesheets, you can quickly see which tasks are incomplete and dig down to understand why you haven’t finished them in the time you may have allocated.

You can find out why a task is incomplete and take action to address the situation.

Who isn’t logging hours and may have the capacity to pick up work

For successful project management, you need to manage the project workload for each member of your team.

Online timesheets can help you with capacity planning.

They can help you distribute the work fairly and check which team members are busy and logging the most hours.

Final thoughts on using project timesheets

You want your business to be profitable, and people are central to achieving the profit margins that makes the difference between success and failure.

It’s true that some people don’t like timesheets.

But you can make everybody’s life that much easier by using online timesheets tools that make tracking time less of a chore and more accurate.

Then you can genuinely take away data that’ll make your project management that much more effective and efficient.

The post Project timesheets: How employers and teams can effectively manage tasks appeared first on Sage Advice United Kingdom.