HMRC are warning those affected by Making Tax Digital for VAT (MTDfV) that they will need to enrol to submit their returns under the new rules from 1 April 2019 (unless they have been deferred) or earlier, if they have been enrolled onto the pilot service.
The pilot service is open to around half a million businesses whose affairs are up to date and straightforward. HMRC will then be extending it to most other business types over the coming months. Those who have signed up for the making Tax Digital pilot will not be able to submit their VAT return via the HMRC VAT services account. They must instead file using MTD compatible and enabled software and keep their VAT records digitally from the first day of the period covered by their VAT return.
Making Tax Digital for VAT recap:
As of April 2019, the majority of business owners and individuals will be expected to keep their accounting records digitally, as MTDfV comes into effect in the UK. The process has been described as one of the most digitally advanced tax administrations in the world and will be compulsory for those VAT registered and those with a taxable turnover of over £85k per annum.
From 1 October 2019, MTDfV is mandated for the entities that have been deferred. These include VAT groups, businesses required to make payments on account, traders based overseas, unincorporated not-for-profit entities, trusts, annual accounting scheme users, certain public sector organisations and public corporations.
Not sure how this will affect you? We can help
If you have any concerns over this update, or anything Making Tax Digital in general, please get in touch with our specialist MTD and VAT team.