If you are registered for VAT, and if your annual turnover exceeds £85,000, all VAT returns filed for periods commencing on or after 1 April 2019, will need to be filed in accordance with the new Making Tax Digital for VAT (MTDV) rules.
Basically, all VAT registered businesses with turnover in excess of £85,00 will need to comply unless they qualify for deferment.
The following businesses will not need to join MTD until 1 October. Businesses included are:
– Part of a VAT group or VAT division
– Based overseas
– A trust
– A not for profit organisation that is not set up as a company
– Submits annual returns
– A local authority
– A public corporation
– Makes payments on account
– Uses the VAT GIANT service
In order to comply with the new MTD rules you must use software that links directly with HMRC’s computer systems.
Almost all accounts software suppliers now have versions of their applications that will do this.
Check with your software supplier to make sure the version you are using is MTDV ready.
If it’s not, then upgrade to a MTD version or change to a supplier who is compliant. Readers who are unsure of which software packages to use, or who presently use spreadsheets or hand written records should call us now, we can help.
Even though MTDV is compulsory you are still required to register with HMRC to get permission to file VAT returns using the new protocols. You can complete this process online.
Again, if you are unsure what you need to do, we can sort this out for you.
When you have sorted out a compatible accounts software product and registered for MTD, the last piece of the puzzle is to authorise your software i.e. link your software with your MTD account at HMRC.
Your software supplier should advise how this can be done.
The process of getting ready for MTD is a one-off exercise, once done the filing of returns should be done fairly routinely.
However, HMRC’s record in integrating new computerised processes is far from satisfactory. It remains to be seen if the development work and beta testing has been comprehensive enough to weed out any issues.
If you encounter problems with any of the registration processes or need our help please call or email us, you can find our contact details in the footer below.