L-R: Jon Hulme, co-founder and MD and John Burke, co-founder and Commercial Director of Craft Gin Club celebrating Sarah’s investment in their company
By using Xero, small businesses can keep track of when their VAT is due, calculate how much is owed and file their returns in real-time to HMRC. The new software will also allow users to continue using spreadsheets to calculate VAT and keep digital records. Support for Making Tax Digital is
available in all Xero plans that support VAT, at no extra cost. As well as ensuring compliance, Xero’s built-in new VAT functionalities save accountants and small businesses precious time.
Zoya: Sarah, what are your companies’ involvement with Xero? Sarah: Craft Gin Club is a Xero customer and therefore enjoys the full digital benefits of the platform which enables smarter accountancy through cloud computing. I am an ambassador for Xero’s most-recent Making Tax Digital campaign, looking at the confusion small businesses face when starting up, with 9 out of 10, approximately 4.9 million small business owners, admitting to feeling “overwhelmed” by regulation when starting their own business.
Zoya: Damon, why did Xero chose Sarah to be a brand ambassador? Damon: A lot of companies Sarah works with, use Xero. Sarah is a fantastic entrepreneur and understands challenges small businesses face and together we have understood that in terms of accounting, SMEs are under-resourced. We also found that even prior to Xero,
16 SME MAGAZINE
AS YOU SCALE UP, IT’S IMPORTANT TO STAY ORGANISED, AND NOT BE SLOWED DOWN BY ADMINISTRATION. ENTREPRENEURS MUST WANT TO INNOVATE AND THINK UP NEW WAYS TO BETTER SERVE CUSTOMERS
Sarah has been helping businesses navigate digital issues. Sarah has demonstrated via the Craft Gin Club how online software can reduce manual tax returns and has put her full commitment to reinforce the idea that businesses will need to use compliance software to get up to speed.
Zoya: What services does Xero offer SMEs in terms of tax knowledge and solutions? Damon: Xero offers small businesses simple and affordable accounting software with the time-saving tools entrepreneurs need to grow their business. By keeping up-to-date digital records in real-time, businesses are less likely to lose receipts and less likely to make errors of the kind that have seen two-thirds of SMBs pay tax return fines totalling £1.3 billion.
Zoya: Sarah, what have been the learnings for your businesses as they grow? Sarah: As you scale up, it’s important to stay organised, and not be slowed down by administration. Entrepreneurs most want to innovate and think up new ways to better serve customers. The last thing a small business owner wants to do is get bogged down in tax, particularly when it’s going digital. Xero’s MTD functionality makes it quick and easy for businesses to file their tax online, meaning time can be spent on growing the business.
Zoya: What are the outdated processes for tax returns that due to legacy systems are incurring fines for SMEs? Damon: These range from paper booking techniques going back to the 14th century to excel spreadsheets, and our latest research found that one-third of small businesses still write down expenses the old-fashioned way and keep receipts in a bag. No surprise then that two-thirds of SMEs we surveyed have been hit by tax return fines totalling £1.3 billion.
Zoya: What are SMEs’ current culture to meet tax regulatory deadlines? How prepared are they for meeting HMRC’s Making Tax Digital deadline? Damon: We’ve found that entrepreneurs are often too busy, too poorly resourced or too inexperienced when starting out to understand the complexities of tax filing. We found that three-quarters of UK businesses (approximately 4.2 million) said
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