The benefits of digitising your accounts
Moving away from manual accounting practices, miscellaneous receipts, and excel spreadsheets can be a daunting task. However, getting up to date with the era of digitalisation, will not only make your business compliant with HMRC ‘Making tax digital’ (MTD) initiative but, can also reap numerous benefits for your business. Here at Kirkwood Wilson, we are specialists in digital accounting and are here to take you through the benefits of digital accounting and explain how our expertise can benefit your business today!
What is digital accounting?
As of April 2019, all VAT registered businesses over the taxable turnover threshold of £85,000 were required to keep digital tax records and submit VAT returns via MTD compliant software. This initiative prompted a roll out of digital accounting software and a surge of online cloud accounting systems. HMRC also advised that companies that earn below the VAT threshold can also sign up for MTD for VAT voluntarily, as it would soon be a requirement for all businesses.
Digital Accounting provides the opportunity to transition your business away from manual bookkeeping to keeping all of your business’s financial information in an electronic format. Digitising your accounts will get you ahead of the game and will make tax returns, invoicing, and making payments a much simpler task.
At Kirkwood Wilson, we are a Xero gold partner and experts in Xero online. Xero is an online, cloud accounting system and also compliant with MTD. We are also experts in Sage and QuickBooks, so we can help you make the best decision about which software is most suitable for your business.
So, what are the benefits of digitising your accounts?
- Streamline your business processes
- Increased reliability – digital accounting allows you to keep your data secure
- Suitable for all businesses and industries.
Streamline your business processes
Manual accounting practices always involve a risk of human error and it is virtually impossible to store financial information in one place. This becomes a struggle when it comes to compiling a report or financial summary.
A digital accounting system will store your all of your information in one place, which gives your business access to real time financial data; from cash flow to balance sheets in a few clicks.
Xero online will provide you and your employees with instant access to your finances from any location and any time, as long as you have access to an internet connection. It can also provide daily summaries of your finances, send invoices, track projects, and so much more, saving you valuable time to focus on other business operations.
Increased reliability – keeping your data secure
Digitising your accounts and using an MTD compliant online accounting system will offer more reliability than manually handling paper documents in a filing cabinet. In the event that your business’s financial information goes missing, there will be no need to worry after digitising your accounts and years of financial information won’t be lost in a flash.
With digital accounting you can backup your data securely, meaning that all information is stored in a remote location and can be retrieved any time of the day.
Suitable for all businesses and industries
Of course if you are under the taxable threshold of £85,000, you might be hesitant or not see the urgency to digitise your accounts, as the April 2019 deadline did not apply to you.
However, it is worth bearing in mind that digitising your accounts will move your business into the 21st century, allowing you to focus on your core operations. In addition with HMRC’s mission to be “one of the most digitally advanced tax administrations in the world”, it won’t be long until your tax returns will be required to be digitalised.
Additionally, we understand that it is important for businesses with numerous departments to be interlinked and up-to-date with key financial information. With paper-based accounting, it can be a timely process updating all departments on the latest financial reports. With online accounting software, any stakeholder, with access rights, can access financial information, leading to fluidity throughout your business.
How can Kirkwood Wilson help in making your accounts digital?
As experts in digital accounting, we can offer you expert advice about Xero online cloud accounting system. One of our experts can talk you through the range of benefits that Xero has to offer. We can also advise, how best to integrate digital accounting practices within your business and how to make you HMRC Making Tax Digital compliant.
Not only do we specialise in Xero, here at Kirkwood Wilson we understand that online accounting systems can be daunting, especially with the varied options and platforms available. We also offer training in QuickBooks and Sage to help you decide on the best approach to digitising your accounts.
To find out more about digital accountancy or enquire about our digital accounting services including Xero, Sage and QuickBooks training, contact Kirkwood Wilson today Call 01704 546 000 or email [email protected].