Chartered Accountants and Professional Business Advisers

Digital deadline coming up fast

Despite the start date for Making Tax Digital (MTD) for VAT coming up this April, it’s disappointing that some of the finer details of the new arrangements are still being worked on by HMRC.

However, the main points are fairly well established and are as follows:

 

  • Some businesses will have their start date deferred until October 2019 and should, by now, have received a letter from HMRC confirming this.
  • Any business that has not received one of these deferral letters must ensure that they are MTD-ready for the first VAT period starting on or after 1 April 2019. This means:

           »» using digital record-keeping
           »» using functionally compatible software that is capable of uploading the VAT return to HMRC
           »» ensuring that where more than one piece of software is used these are linked digitally.

  • Penalties will apply for failure to comply with the MTD requirements.
  • HMRC will apply a light-touch approach to penalties until 30 March 2020 – but only in relation to the requirement to have digital links.
  • Businesses must actively register for MTD and will not be transferred automatically to the new system. However, we would recommend waiting until your March/April/May 2019 return is filed before registering for MTD – unless your software is already MTD-compliant. (You can get in touch with Shipleys if you need help registering.)
  • The current VAT return filing portal will be phased out and once a business has signed up to use MTD their access to the portal will be cut off.

Further information is available on the HMRC website, together with a list of software suppliers that offer MTD-compliant software.

Here at Shipleys we’re keeping abreast of developments, so please get in touch if you need any help in relation to MTD for VAT.

 

Need more help? Please contact us at advice@shipleys.com or +44 (0)20 7312 0000