Small and medium-sized businesses that use digital software to help with their accounting process could save 27.6 days a year, analysis by Sage shows.
In 2018, Sage conducted research on digital accounting as the government introduced Making Tax Digital, a move that they are still very much encouraging.
Making Tax Digital is a plan to transfer tax administration online, making it easier and more time efficient for individuals and businesses to get their tax right.
According to Sage’s research, 59% of SMEs were using digital software for accounting in 2018, while 18% continued to use manual methods.
On average, those using digital methods estimated that they were saving 2.3 days a month on accounting processes and 27.6 days a year – worth around £17,000 a year in saved time.
According to Sage, the main barriers preventing business owners from moving to digital accounts included:
- a lack of digital skills
- concerns about how difficult the software is to use
- the time it would take to get used to new systems
A survey conducted asked SMEs to provide an estimated number of days per month that digital accounting would save. Here are the results:
- 4% of SMEs believed there would be no time saved
- 33% believed they could save 1 day or less
- 25% believed they could save between 2-3 days
- 20% believed they could save between 4-7 days
- 18% didn’t know.
Boosting productivity isn’t the only benefit of digital accounting. It also enables more timely and accurate information, which can influence better decisions for your company.
When using cloud-based software, sharing important information between partners and colleagues has never been easier.
Alain Laing, managing director at Sage UK & Ireland, said:
“British businesses need support to become truly digital, so they can focus on their unique products and services, serving their customers, and driving the UK economy by creating jobs and prosperity.
With the right training, support and framework, we believe that Making Tax Digital will be instrumental in helping give businesses precious time back.”
Could the coronavirus crisis be the catalyst for change?
Since so many employees started to work from home during the coronavirus lockdown, workers and business owners are beginning to feel more confident in using new technology and working digitally.
With a recent study from Okta revealing that 75% of workers would continue working from home even after the coronavirus crisis, this could mean that more businesses decide to evolve and start making their tax administration digital if they haven’t already.
We can assist with your digital accounts.