Making Tax Digital - VAT for ALL
Do you know the timeline and progress for the Making Tax Digital changes?
Making Tax Digital is the Government’s flagship scheme “to make it easier for individuals and businesses to get their tax right, and keep on top of their affairs” according to the HMRC website. It will also help them to combat fraud, and reduce errors.
MTD, as it is known, is currently applicable to all VAT-registered businesses with a taxable turnover above the VAT threshold (i.e. £85,000). Businesses below that have been able to join voluntarily since the scheme was announced.
From April 2022, all VAT-registered businesses are required to follow the MTD rules: using digital record-keeping and paying VAT quarterly.
If your business is registered for VAT, we strongly advise getting started on the MTD route as soon as you can, so that you can iron out any teething problems and get into good habits before it becomes compulsory. There will be penalties for non-compliance after April 2022.
In order to comply with MTD, you need to be using a software system that is compatible, and we are happy to advise new and regular customers on how to go about this.
Our recommended software is Xero, but there are plenty of others that meet the requirements. You can check here if your current system is compatible: https://www.tax.service.gov.uk/making-tax-digital-software?_ga=2.124155720.33386271.1597661244-1006742944.1593519079
Please do get in touch if you need support with Making Tax Digital.