Accounting for today's business taste
UK taxation for self-employed contractors, from barristers to Deliveroo drivers is both important to understand and tedious to implement. Nobody knows this better than accountant and My Digital Accounts founder, John Whelan.
His team’s vision was to radically simplify the tiresome process by which contractors, together with small and medium businesses help pay for Britain’s hospitals, roads and other services.
Today, My Digital Accounts is the largest commercially available accounting software provider to the UK’s gig economy, processing transactions for 20,000 contractors every week.
Taxation is often humorously referred to as one of life’s two great certainties, alongside death. However, becoming a victim of poorly designed tax software is now a matter of personal choice.
Modern working life has improved dramatically with technology creating flexible, family-friendly roles. Customer relationships can be managed using thumb swipes on mobile devices. Meanwhile, the manual accounting systems still used by many contractors and their accounting providers, to record their income and pay their taxes are literally from a different era.
The UK Government knows the widespread use of poorly designed accounting software may be crucially important for the entire UK economy, of which 15% are freelancers and contractors working in the so-called Gig Economy. HMRC has spelt out its intention of digitising taxation, with its Making Tax Digital (MTD) initiative and also signalled further complexity with the extension of the IR35 legislation up the payment chain!
IR35 will be extended to the private sector in April 2020 and will affect the self employed. What has happened to the office of tax simplification, you may ask
UK focus - global insight
Following years of intensive development, My Digital Accounts unites a dedicated development team in India with the deep domain experience of its UK-based customer success team. Its cloud-based software has been developed since 2015, when MTD first emerged.
Together this team has been approved by HMRC to provide digital services including payroll, construction industry payments and VAT processes (including Making Tax Digital). While rivals adapted existing accounting solutions from the world of physical ledgers, spreadsheets and line printers, its modern all-digital solution has proved successful.
My Digital Accounts is available on Android and iOS, the tools of choice for modern mobile workers and in use by scores of accounting services providers for temporary, contractor and agency workers, many of whom will be affected by the proposed IR35 changes.
Built for tomorrow not yesteryear
Because all this data is held in the cloud, complying with stringent data protection laws, like the EU’s GDPR, become non-issues for busy workers who quite rightly expect modern technology which works for them. My Digital Accounts is approved and promoted by HMRC and in use by scores of accounting providers and their end users.
At the heart of the My Digital Accounts system are three closely interlinked systems to deal with Customer Relationship Management, Payroll and Financial Accounting. As these have all been custom-developed for the UK economy, they seamlessly link to HMRC’s new digital tax system and can, of course, account for the need to accrue for employee pensions using schemes such as NEST, the Apprentice Levy and the National Insurance Employment Allowance as well as calculating Deemed Payments, as required under the IR35 guidelines.
For those with even more sophisticated needs, My Digital Accounts uses the latest API technology to link to popular external systems such as Zoho and Salesforce. For those in transition from the old world, Sage users are also accommodated. For Whelan and his Cheshire-Chennai scale-up there’s a lot to do. Accounting in the digital age remains important but contractors are not condemned to it remaining tedious.