News
Making Tax Digital - Find Out More
08 - 11 - 2018
What is Making Tax Digital?
MTD is part of the UK
government’s plan to use computer systems to help make the tax administration
system more effective and efficient. Businesses and individuals are being
encouraged to make use of software available to reduce the amount of paper
returns.
Who will it affect?
The idea is to introduce both
businesses and individuals to the digital systems slowly with a phased
introduction. Businesses are already filing some returns such as PAYE and NI
through the RTI system and Corporation Tax returns through HMRC software.
When will I need to start complying with MTD?
MTD will initially be applicable
for VAT. Any business above the VAT threshold of £85,000 turnover must file a
VAT return. Any VAT period starting on or after 01 April 2019 must be recorded
digitally and filed following MTD VAT rules.
What if I am voluntarily registered for VAT but not above the VAT
threshold?
If you are below the VAT
threshold but VAT registered the MTD rules will NOT apply as of 01 April 2019
but will be phased in later. You could, however, still choose to use the system
voluntarily from 01 April 2019.
Can I use HMRC software for MTD?
No. HMRC have not developed any
software for MTD. In order to submit your VAT return post 01 April 2019 you
will need to use commercial software with the capability of communicating
directly with HMRC’s interface. Your accountant should be able to record and
submit the information as your agent on your behalf.
What will I need to do?
You will need to maintain your
accounting records digitally in a software product or spreadsheet. Maintaining
paper records will cease to meet the legal requirements in tax legislation. The
VAT return will need to be submitted to HMRC using a compatible software. The
option to type numbers into the HMRC return online will no longer be available.
Foremans will record and submit VAT for our clients.
Are there any other changes to the VAT legislation?
No. There are no other changes to
VAT. The VAT return will contain the same nine boxes that it currently does.
The current filing and payment deadlines have not changed.
When will other taxes
be affected?
Income Tax and Corporation Tax will be affected from April
2020 at the earliest. Further details have still to be announced
Why not telephone for a no obligation discussion about your
circumstances:
01244 625 500

