Discussions of the biggest digital transformation the government has seen to date are underway; should HMRC introduce mandatory, quarterly digital tax accounts for the self-employed and small businesses? According to the 100,000 signatures on an SME business owner’s petition, the answer to that question is no. The decision is being brought before parliament later this month in light of the appeal, to discuss the pros and cons of such a big change.

Digital accounting

One of the main objections set forth regarding this reform appears to be the commonplace issue of technology illiteracy; many small companies are without a dedicated ‘IT Manager’, and run by a non-computer literate owner. This change would therefore instantly impose a great deal of further expense on a company, especially a small business with a low-profit margin, in the form of computer training, as well as any software to go alongside. Attempting to enforce this technical transformation as mandatory practice will logically evoke a negative response from those affected; Anthony Thomas, chairman of the Low Incomes Tax Reform Group, makes the valid suggestion that the HMRC should work on the development of a simple, user-friendly software that companies will naturally warm towards.

Adoption of Digital

This attempted automation of tax records leads into the larger issue of the digitisation of the economy as a whole. If the accountancy occupation fails to adapt to the new and emerging technologies being made available, where will that leave the profession? Technology offers an equal balance of opportunities and risks to the future of accountancy. Accountancy firms must evolve alongside these emerging technologies to take every available advantage. For example, cloud computing provides users with the tools to function in a much more flexible manner; it is now possible for accountants to send and receive ‘real-time’ client information and data, providing their clients with a service as and when necessary. Thanks to the nature of ‘real-time’ computing, professionals are granted extra time to spend on ‘value-added’ activities, keeping their clients happy as well as their business. Providing it is used effectively alongside the appropriate training and support, cloud computing can and will change the way in which accountants can provide services to their clients in a positive manner.

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