Pre-Budget Statement - New Requirements to File Online

In order to reduce their own costs, HMRC is gradually moving from encouraging, to requiring, traders to submit Tax Returns online.
Firstly, all employers will be required to submit their annual PAYE Returns for 2009/10 and later years online. Hitherto, this has applied only to firms with 50 or more employees. Employers who have until now made paper Returns (on Forms P35 and P14) need to start planning how they will comply with the new requirement - basically, the choice is either to ensure you have suitable software to submit the Returns yourself, or to arrange to outsource the preparation and submission of Returns.
Secondly, VAT Returns for prescribed accounting periods beginning on or after 1 April 2010 are supposed to be submitted online, unless the trader's annual turnover is less than £100,000 (excluding VAT) and he was first registered for VAT before that date. However, penalties for continuing to file a paper Return will not be imposed until April 2011.
Thirdly, from April 2011 Corporation Tax Returns will have to be submitted online - however, one expects that most small companies will have their accountants file their Returns.
From 2010 VAT, and from 2011 Corporation Tax, will have to be paid electronically, however, this does not mean that traders will be obliged to adopt online banking. Any method of payment may be used, provided the remittance reaches HMRC as an electronic transfer of funds - this would include, for example, paying over-the-counter at a bank, using an ordinary cheque and the official payslip. Of course, online banking may offer advantages, such as convenience and a reduction in the delay between the funds leaving your account and being credited to the recipient's account.