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HMRC digital accounts backed by freelancers' accounting firm

HMRC digital accounts backed by freelancers' accounting firm

FreeAgent, an accounting firm for freelancers, has issued a statement of support for HM Revenue & Customs' new digital tax accounts for the self-employed.

The company says it is “glad” that the 2015 Autumn Statement included the extension of plans for the digitisation of HMRC's methods and that a £1.3billion investment had been set aside to fund it.

More efficient

FreeAgent’s boss Ed Molyneux said: “The result should be a more efficient, streamlined HMRC that is also better able to focus its resources on chasing down genuine tax avoidance.”

“It’ll also dramatically reduce the burden of tax compliance - which is disproportionately shouldered by the very small businesses,” Molyneux claimed.

However, other tax advisers and commentators have expressed concerns.

Quarterly updates

HMRC’s digitisation plans include digital tax accounts for sole traders, which will eventually need to be updated at least four times a year.

Tax advisory firm Blick Rothenberg senior partner, Bob Rothenberg, asked: “Is this a precursor to accelerating personal tax payments where tax is not deducted at source…?”

“Is this a boost for my profession, so that clients will need assistance with tax return preparation quarterly? And what about those who are IT illiterate… will they be able to cope?” he added.

FreeAgent's Molyneux rejected the worries and said the changes were long overdue in order to reflect the modern world of online shopping and banking via smartphones and other devices.

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