Dreading digital? Fear not, I’ve got a MTD Game Plan
Are you filled with dread knowing the next phase of MTD is coming in just six months?
Yes, six months.
‘But what about the delay?’, I hear you ask.
It’s true, MTD for Income Tax has been put back by a year, but the extension of MTD for VAT, and the pilot for ITSA remain on track for April 2022.
There’s only one way to tackle these enormous changes with confidence rather than fear. Solid, proper preparation.
Simply put, you need an MTD Game Plan. And I’m going to help you with that here.
Why is it important to have a game plan?
Obviously, compliance is key. But there’s an even greater motivation for accountants than that thanks to the huge opportunity MTD creates to grow your practice.
There are 1.1m VAT-registered businesses that must comply with MTD for VAT from April 2022 and 4.2m unincorporated businesses, individuals and civil society organisations, including around 2.6 million self-employed individuals, and 1 million landlords. The majority will need to be compliant with MTD for Income Tax from April 2023.
Planning ahead and working out the strategy now means that you can make as much out of this opportunity as you want.
The key parts of the MTD Game Plan
Let’s break it down and explore what your accountancy practice needs to look at:
- Know your client base
It’s important to identify the various sub-sets of clients and divide them into different buckets. Your firm likely have the following types. Those who:
- Give you a shoebox or bag full of receipts
- Send you spreadsheets
- Are very digitally aware and high-tech
- With digital record keeping software
- Expecting you to simply “keep them compliant”
2. Identifying clients by compliance stages
You need to identify the groups for each stage, who they are and what are they doing now. What are the requirements for them and how it will change?
Example one: April 2022 – VAT-registered clients
Example two: April 2022 MTD for ITSA pilot – your test cohort: self-employed clients and sole traders with income of £10,000 and more, including landlords.
You should be able to put them into the groups, and plan month by month. Then you can see:
- How many you have
- How they are doing their record keeping
- When you are going to onboard them
- What software they are using, if any
You will need to have a conversation with some to explain what’s happening.
But how can you approach this in a smart way without having to split yourself in two?
Getting it right
These two points are critical to get right because they will enable you to create a different approach for each group; distinct packages that suit your clients’ individual needs the best, helping you to shape a strategy for delivery to each group.
I’ll delve into the details of making a brilliant MTD Game Plan in my next blog.
In the meantime, drop me a line on LinkedIn and hear directly from other accountants on their MTD plans and/or follow our Superhero Accountants and Bookkeepers Club on Clubhouse https://www.clubhouse.com/club/superhero-accountants