If you comply to Making Tax Digital and your first VAT quarter started on April 1st, you have until August 7th to file you VAT return via Making Tax Digital. HMRC hope that by introducing MTD it will simplify the process of filing VAT returns and reduce the amount of tax lost to errors. Government figures indicate that £3bn is lost each year to avoidable VAT errors.
What is MTD?
From April 2019 all VAT registered businesses with a turnover greater than £85,000 will be required to keep digital VAT records and submit their returns digitally. Those with a smaller turnover can still register on a voluntary basis.
How do I comply?
To comply you must keep digital records of your VAT from April 1st and you must submit your returns using compatible software. Click here to see HMRC’s list of compatible and bridging software.
How do I sign up for MTD?
You can register for MTD on the HMRC website. You must sign up at least 72 hours before you submit your VAT return. If you are paying by direct debit you must register seven working days before.
After signing up for MTD, you can no longer use the VAT online services or the government gateway to submit your returns.
You must file your return by the filing deadline. HMRC will take your VAT return figures directly from your compliant accountancy software. Click here to sign up for MTD.
What happens if I have not signed up in time?
With thousands of firms yet to sign up for MTD, HMRC has promised to be lenient and have provided a soft-landing period for MTD. During the first year HMRC will not be issuing penalties to businesses doing their best to comply.
However, there is no leniency when it comes to paying the VAT bill, any business which does not pay their VAT return or pay after their deadline will be exposed to penalties.
If you encounter any issues when submitting your VAT return yourself call HMRC. HMRC have doubled the number of staff on their helplines in preparation for the first MTD compliant VAT return.
How can we help?
As a practice we believe passionately in supporting the businesses we work with, and whilst a lot of firms have decided to just offer clients software with no additional support, we have created a full-service that will provide our clients with a complete solution for MTD.
The solution we have created for clients has been designed to meet all of your business needs, and includes:
- A mobile scanning system that will come to our clients and digitise all of their invoices and receipts in under an hour.
- Complete access to IRIS’ award-winning cloud-based KashFlow accounting software.
- Access to our app, that lets clients upload pictures of their receipts and have 24/7 access to their accountant.
Click here to find out more information on how we can help you with Making Tax Digital.