MTD gets digitally linked

The MTD soft landing period has now ended for VAT, meaning that for MTD VAT registered businesses and for periods beginning on or after 1 April 2021 there will likely need to be digital links between the accounting information making up your VAT accounts, or your ‘electronic account’ (to use the VAT notice terminology).

Details of the gov.uk guidance can be found here.

 

This will mean that when preparing your next return you may need to consider how the data is collated in an electronic way and how your system will account for this going forward. If you prepare manual records on a day-to-day basis, it may be necessary to consider at what point in your system your records become digital and that the key information has been held digitally in line with the requirements of the regulations.

The GOV.UK guidance in the link above also contains some useful examples of how the process may apply to various businesses and systems.

If we prepare your VAT returns here at Richardson Swift, your Client Advisor will be in touch to discuss the options or if anything needs to change with your current system.

For businesses not registered for MTD but who file VAT returns online, you will no longer be able to do this via your accounting package but will need to login to the HMRC VAT portal and input the totals there. Speak to your client advisor about switching to MTD if this is something you would like to consider. There are additional compliance requirements involved (as you will see above), but it may be that you wish to move across before mandatory compliance for all VAT registered businesses, which is currently scheduled for 1 April 2022.