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<p>The costs incurred in the move to digital record keeping and reporting through
Making Tax Digital (MTD) will vary from business to business, and are dependent on
factors such as business size, complexity, degree of digital capability and the cost
and functionality of the software used. There are free software products available
for businesses with the simplest affairs.</p><p> </p><p>HMRC’s early estimates published
on 21 July anticipated that businesses will incur costs of, on average, £175 to make
the transition to MTD, with about £20 a year in additional continuing costs. HMRC
have since undertaken significant engagement with representative bodies within both
the business and accountancy worlds, as well as software developers, in order to further
understand the associated costs of future MTD mandation. These costs represent an
investment that will yield dividends in terms of increased productivity and turnover.
HMRC are working with these bodies in order to ensure estimates are accurate and will
do all they can to minimise costs. A new publication with revised estimates will be
published in due course.</p>
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