YOU may have read that HMRC plans to force businesses to file four tax returns a year instead of one.

There is in fact no such plan, but what is actually being planned is in many ways even more radical.

This year, the ten million individuals who currently file tax returns will have access to a personal on line tax account.

HMRC will “pre-populate” this with information it already holds such as income from employment and from private and state pensions.

Next will come details of interest from banks and building societies.

Over the years, more and more information will be added, leaving less and less to be supplied by the individual.

The government aims to make the annual tax return a thing of the past, though I think that many people will find that they still have to supply significant amounts of information either personally or via their accountant for some years to come.

Businesses will also be given digital tax accounts which will enable them to track their tax affairs online, and from 2018 all businesses – including the self-employed – and most people with income from letting will be required to keep their tax records digitally and to upload information to HMRC at least once a quarter.

That will mean the end of hand written records.

It will be a huge change for many smaller businesses.

The idea is that businesses will use accounting software or apps on smartphones to capture and record business transactions.

The government believes that this will improve the quality of record keeping, make it easier for businesses to comply with their tax obligations and reduce their costs.

Many small businesses and representative bodies have expressed concerns and over 100,000 people have signed an online petition to protest.

The plans are to be debated in parliament on January 25.

If you are in business and currently keep hand written records you will have no choice but to change to digital.

You will either need to use apps or software yourself – and HMRC will ensure that free apps and software are available – or else you will need someone to do it for you.

I fully support the idea of digital tax accounts, but I share the widespread concern about forcing businesses with manual records to change to digital. If there are advantages – which I believe there are – then businesses will do this as a matter of choice. They should not however be forced.

Paul Aplin OBE is a tax partner with A C Mole & Sons and chairman of the Technical Committee of the Institute of Chartered Accountants in England & Wales Tax Faculty; you can follow him on Twitter @PaulAplinOnTax.

He and fellow tax partner Amanda Gunter can be contacted on 01823 62445.