UK Budget - Tech investment and digital tax processes

"The UK continues to navigate a period of significant uncertainty, emphasised by the reported £22 billion ‘hole’ in public finances, and while increased taxes were expected in today’s autumn budget, this is not the only answer. Embracing technology to streamline financial processes for businesses will enable easy, efficient and accurate tax reporting. And the government seemingly agrees, with its announcement today that it will be modernising HMRC systems using technology in a bid to close the tax gap by ensuring everyone is paying the right amount of tax.

Businesses need the government to push forward with these modernisation initiatives to improve the way they report finances and taxes. Since the introduction of Making Tax Digital (MTD) for VAT in 2019-20, little further progress has been made in the digitalisation of the tax system. This is frustrating after businesses put in significant effort to lay the foundations for big change. The UK has one of the most complicated tax calculation processes in Europe.

You need only look at, for example, partial exemption, which sees every business report this exemption in a unique way, to see just how complex these calculations can be.There is no denying that technology investment is the only long-term solution and it is encouraging to see the government recognising this in today’s budget announcement. We are seeing businesses take the initiative to further drive their digitised tax initiatives forward regardless of HMRC regulation, however, businesses need the continued support of the government to improve reporting accuracy and efficiency. Now is not the time to stagnate. Now is the time to push forward and realise the full potential of the digitalisation of tax."